IHS said low regulated gas prices have precipitated a supply shortfall in India, but proposed that reforms to the pricing formula could yield higher domestic production and boost India's economy.
Wholesale inflation shot up to a 30-month high of 5.25 per cent in January as rising global crude oil prices spiked domestic fuel cost, even as food prices moderated.
Reliance Industries Ltd (RIL) on Wednesday asserted in the Supreme Court that it did not receive any favour from the government in the contract for exploration of oil and gas from Krishna-Godavari basin.
The withdrawal of the arbitration will now entitle the two companies to marketing and pricing freedom on the natural gas they produce from newer fields in the deep sea at an investment of Rs 40,000 crore by 2022.
While a new formula for pricing of all domestically produced natural gas was notified on January 10 and published in Gazettee on January 17, the Election Commission last month asked the government to defer its implementation till general elections are completed.
An expert panel approved policy for development of gas fields.
Imported Ethane will substitute its current propane imports and a portion of naphtha used for ethylene production.
RIL-BP currently produce gas from Dhirubhai-1 and 3 field and oil and gas from MA field, three of the over one-and-half dozen discoveries made in KG-D6 block
India and Japan's effort to form a multilateral group of liquefied natural gas buyers to avoid paying higher prices for the fuel is laudable as an objective but is unlikely to be effective immediately.
Overnight, the Wall Street closed on a flatter note.
Moody's said it expects exposure to low oil prices to shave off 0.8 per cent from real GDP growth on average across oil exporting countries in 2016.
Credit Suisse said $5.6 may work for Reliance Industries' R-Series gas field in the KG-D6 block but the economics for its satellite fields and NEC-25 block are uncertain.
Contract does not provide for retrospective penalty for 'such' acts
He added every dollar rise in the gas price will result in Rs 4,000 crore of revenue and Rs 2,300 crore in profit after tax.
Barclays said the refinery would, however, now need to find new sources for the energy for its internal uses.
The agency said the rating revision to stable with apositive outlook reflects continuing strong financial and operating performance.
After grappling with the issue for two years, the Ministry of Petroleum and Natural Gas had on November 21 ordered that the margin to be charged, over and above the gas sale price, should be fixed between the seller and buyers in all sectors other than urea and LPG.
Oil Minister M Veerappa Moily approved continuation of the existing rate of $4.2 per million British thermal units until the new government, which will be in place in May, decides on implementation of the new price formula.
The Standing Committee on Petroleum and Natural Gas in a report tabled in Parliament said the proposed formula is a simple average of two methodologies -- price of imports of LNG into India by different suppliers, and weighted average of prices of natural gas prevailing at Henry Hub in USA, National Balancing Point in London and netback import price at the well head of suppliers into Japan.
They also voiced concerns over a double penalty being sought to be imposed on them for KG-D6 fields output not matching targets.
Days after the Cabinet approved doubling of natural gas price from April next year, the Finance Ministry has written to Oil Ministry suggesting setting of a ceiling or an upper limit for the rates.
The previous United Progressive Alliance government had last year approved pricing of all forms of domestically produced gas at according to a formula suggested by a panel headed by C Rangarajan.
With the government's focus on environment-friendly fuel, Indraprastha Gas, Mahanagar Gas and Suzlon's earning prospects look bright
The pricing and marketing freedom for exploitation would be capped by a ceiling price.
A nearly two-fold hike in natural gas prices will incentivise investment in the hydrocarbon sector and help reduce the energy import bill, India Inc said.
RIL has been selling gas from KG-D6 at the same price since it started production in April 2009.
'Earlier compensation was less, but we have increased compensation four fold. As a result, farmers want to give up their land.' 'Infrastructure projects will create 50 lakh jobs. If today we are building 14 km of road per day, by next March, we hope to take it up to 30 km. My own hope is we can take it to 100 km per day.' 'The government's ambitious Sagarmala project aims to develop port infrastructure along the country's 7,500 km coastline. The project includes modernisation of our ports and islands, setting up of coastal economic zones, new major ports and fish harbours.'
Infra major GMR is hopeful of maintaining strong order book.
In the 38-page report, across 10 chapters, RIL explained how it entered the exploration and production business; the history of the New Exploration and Licensing Policy and the introduction of production-sharing contracts.
Reviving stranded gas-based power plants and substituting diesel usage is a clear near-term opportunity.
BJP's success in two state elections gave Modi room to cut through a thicket of regulations and state controls.
Energy conglomerate Reliance Industries and its partner BP plc on Friday said they have made a second deep-water gas condensate discovery in the Cauvery basin, off the east coast.
While the government had in June approved a new formula for pricing of all domestically produced natural gas, the Cabinet yesterday allowed the same principles to also be applied to Reliance Industries' currently producing fields in KG-D6 block subject to certain conditions.
Amidst Finance Ministry raising prospects of forcing Reliance Industries to sell gas at old price of $4.2, Oil Minister M Veerapa Moily on Thursday said there was no rethinking in the government on the decision to double gas rates from April 1, 2014.
Link between oil exploration and markets can be used by India to great advantage.
A day after deciding to nearly double natural gas prices to $8, Finance Minister P Chidambaram on Friday hinted that power and fertiliser units may get gas at subsidised rates to keep electricity and urea costs down.
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