Reliance Industries Ltd on Monday (13 October) posted a better-than-expected 1.7 per cent rise in second quarter net profit, helped by strong growth in refining margins which neutralised slump in oil and gas earnings.Net profit in July-September at Rs 5,972 crore, or Rs 20.3 per share, was 1.7 per cent higher than Rs 5,873 crore, or Rs 20 a share earning in the same period last fiscal, the company said in a statement here.RIL, the operator of world's biggest oil-refinery complex, earned $8.3 for turning every barrel of crude oil into fuel in Q2 as compared to $7.7 a barrel gross refining margin a year ago.The GRM, however, was lower than $8.7 per barrel in the previous April-June quarter.Turnover dropped 4.3 per cent to Rs 113,396 crore due to lower crude oil prices and volumes mainly in the refining and oil and gas business.Exports too dipped 14.7 per cent to Rs 66,065 crore ($10.7 billion) as against Rs 77,428 crore in the corresponding period of the previous year.Pre-tax profit from refinery business jumped 18.5 per cent to Rs 3,844 crore even though revenue dropped 5.9 per cent to Rs 103,590 crore on slump in international oil prices and lower processing.While petrochemical earnings were almost unchanged at Rs 2,361 crore, pre-tax profit from oil and gas business dropped 14.4 per cent to Rs 818 crore due to drop in production.Commenting on the results, its Chairman and Managing Director Mukesh D Ambani said: "RIL's financial performance for the period stands testimony to the intrinsic strength of our integrated business operations. The refining and petrochemical businesses, once again, delivered robust results, outperforming regional industry benchmarks.""These projects will propel the next phase of growth for India and Reliance," he said."Renewed optimism in the domestic economy augurs well for business and consumer confidence particularly against the backdrop of continuing concerns on global economic growth."We expect to create significant value for our stakeholders over the next 12-18 months as we complete our large investment programme across energy and consumer businesses. These projects will propel the next phase of growth for India and Reliance," he said. (Agencies)
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A power plant in New Delhi is among 37 across India that have either exhausted their coal or have less than four days' supply, a shortage that has forced some states to ration power for industries and homes.Many states have been hit by a severe power deficit which has dealt a blow to small-scale factories that produce everything from steel to textiles and cannot afford alternatives such as diesel generators."The situation is very bad, with power cuts of up to 16 hours a day," said Vijay Agarwal, a director at Puja Ferro Alloys in Goa. "The shortage has raised our costs while output is at 60 percent of what it should be."The New Delhi plant, run by India's largest power producer NTPC Ltd has shut one of its five units due to coal shortage, a company official said.Sixty of India's 103 power plants have coal enough for less than a week, mainly due to lower supplies from Coal India, according to the Central Electricity Authority.The level of coal stocks is the worst in about six years, forcing power companies to import huge consignments and leading to congested ports. In early September, 53 plants had less than a week's supply on hand.To deal with the power deficit, Telengana has started cutting supplies to industries for two days a week, a move that industry body ASSOCHAM said will badly hurt small and medium sized companies."While all the segments of the industry will bear the impact, the small scale units will face death knell," ASSOCHAM Secretary General D.S. Rawat said in a statement.Apart from Goa, industries in Maharashtra and Tamil Nadu are suffering from frequent power cuts.Coal ImportsState-owned Coal India, the world's largest miner of the fuel, accounts for more than 80 percent of the country's total production but has failed to raise its output fast enough to cater to the increasing needs of the power sector.Its April-September production fell short of its target of 220.11 million tonnes by more than 9 million tonnes. Coal India's production shortfalls have already made India the third-largest importer of coal despite sitting on the world's fifth largest reserves.But a Coal India official told Reuters on Friday that the company cannot be expected to supply all the coal that power companies need and that they should import a percentage of their requirement.Forced by populist governments to sell power at regulated rates, many debt-laden state power companies shy away from importing coal, given the higher costs. Importing coal can cost twice as much as buying it from Coal India.Still, India's coal imports hit 168.4 million tonnes in the fiscal year through March 31 and are rising as the new government has promised to scale up power output to light up every home. About 400 million of the 1.2 billion Indians still live without electricity.India's inbound shipments of thermal coal, used in power generation, are expected to surge 11 percent to 150 million tonnes this fiscal year, according to online market operator mjunction.Annual coal imports could jump by as much as a third to more than 200 million tonnes for the next few years as a result of a court ruling last month that will halt mining of the resource by most private companies from next year.(Reuters)
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Rosneft has offered stakes in its two east Siberian oilfields to Oil and Natural Gas Corp, two Indian sources with direct knowledge of the matter said, as the sanctions-hit Russian company looks beyond Western firms to develop its vast resources. The sanctions imposed on Russia by the United States and Europe to punish Moscow for its incursion into Ukraine, have cut Rosneft's access to Western financing and technology. Rosneft has offered an up to 49 percent stake in Yurubcheno-Tokhomskoye and 10 percent share in Vankor field to the state-run ONGC, said the source familiar with the discussions. "They need money and want to hire partners. They want to demonstrate to the U.S. and Europe that there are partners available for them," said one of the sources. ONGC would firm up its decision on participation in the two projects before the planned visit of Russian President Vladimir Putin to Delhi in December, this source said, adding the two fields are in geologically challenging areas. The European Union has imposed sanctions on Russia's finance, defence and energy sectors and has frozen the assets of some 140 Russian and Ukrainian individuals and companies over Moscow's role in Ukraine. The sources declined to be identified because of the sensitivity of the matter. Rosneft declined to comment. Rosneft's chief Igor Sechin, a close ally of Putin, has been on the U.S. sanctions list since April. Rosneft itself was added to the list in July. Production at Yurubcheno-Tokhomskoye will start in 2017. The field is to supply Asian markets via the East Siberia-Pacific Ocean pipeline and feed a yet-to-be-built petrochemical plant in Russia's Far East. In a major about-turn, given the Kremlin's long resistance to allow its powerful neighbour access to such deposits, Putin last month said he welcomed the idea of China joining the prized Vankor field. Vankor project is vital for Rosneft to meet its growing commitments to supply Asian markets, above all China. Rosneft is preparing to more than double oil exports to China to over 1 million bpd, seeking to secure market share and billions of dollars in pre-payments. (Reuters)
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Coal India Ltd's divestment process should begin immediately after the Diwali festival on Oct. 23, Manoj Joshi, joint secretary of financial markets in the Finance Ministry, said on Wednesday.The government wants to sell a 10 per cent stake in the state-owned company this fiscal year ending March 31 as part of many divestments aimed at bolstering its stressed finances.(Reuters)
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The government has signed a memorandum of understanding with a group of companies to build the country's first ever offshore wind power project as part of New Delhi's pledge to increase renewable energy sources. The 100 megawatt plant will lie off the coast of Gujarat and be partly financed by state subsidies. The company, for which MoU was signed between the Ministry of New and Renewable Energy and other partners, will undertake detailed study based on the inputs received from pre-feasibility studies and necessary steps for implementation of the project. The consortium includes National Thermal Power Corporation (NTPC), Power Grid Corporation of India Ltd (PGCIL), Indian Renewable Energy Development Agency (IREDA), Power Finance Corporation (PFC), Power Trading Corporation (PTC) and Gujarat Power Corporation Ltd (GPCL). Renewable energy sources such as solar and onshore wind farms currently generate less than 2 per cent of India's energy needs, with coal fuelling the generation of around three fifths and gas and hydropower most of the remainder. Prime Minister Narendra Modi, who oversaw the launch of several solar power plants in Gujarat when he was chief minister of the state, has said India needs to expand its renewable energy capacity to help meet rapidly growing demand. Union Renewable Energy Minister Piyush Goyal said the project is a "great opportunity in the development of renewable energy resources in the country." It has been proposed to provide subsidy for setting up of evacuation and transmission infrastructure of the offshore wind power to the main land, besides provide financial support for carrying out studies such as wind resource assessment, Environment Impact Assessment (EIA), oceanographic survey and Bathymetric studies. The renewable energy ministry would also assist in obtaining clearances involved during the implementation of the project. "Partnerships should be built with Defence, Coast Guard and Shipping to ensure seamless and time bound approval process," Goyal said. (Agencies)
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Petrol price was on Tuesday cut by 54 paisa a litre, but the first reduction in diesel rates in over five years was put off until the return of Prime Minister Narendra Modi from the US. State-owned oil firms, which skipped raising rates on September 16 even though their cost had gone up, cut prices in view of the downward trend in international markets. Petrol price was reduced by 54 paisa a litre without including local sales tax or VAT, with effect from midnight tonight. After accounting for the incidence of local sales tax, petrol rate in Delhi was reduced by 65 paisa to Rs 67.86 per litre, according to Indian Oil Corp (IOC), the nation's largest fuel retailer. In Mumbai, petrol price was cut by 68 paisa to Rs 75.73 per litre. Petrol price was last cut by Rs 1.50 a litre, excluding state levies, on August 31. That reduction in Delhi came to Rs 1.82 per litre. Alongside, the price of non-subsidised 14.2-kg cooking gas LPG cylinder, which consumer buy after exhausting their quota of 12 subsidised bottles in a year, was cut by Rs 21 to Rs 880 in Delhi. However, a reduction diesel rates, the first since January 2009, was put off till Modi's return from the US as the Oil Ministry felt it did not have a clear mandate to reduce rates post the January 2013 decision of the Cabinet to raise prices by 40-50 paisa a litre every month. Petrol price was cut as it is a deregulated product needing no government intervention. Softening international oil rates has meant that diesel under-recovery or the difference between retail price and its imported cost was wiped out and there was an over-recovery of 35 paise a litre from September 16. This over-recovery is now about Re 1 a litre. Oil Minister Dharmendra Pradhan is believed to have already written to Modi on the emerging scenario. Also, the ministry has written to the Election Commission seeking their concurrence for the price decrease in view of state assembly elections in Maharashtra and Haryana. A decision will be taken after Modi's return, they said. Sources said the Oil Ministry is of the view that while the Cabinet Committee on Political Affairs (CCPA) on January 17, 2013, allowed a monthly increase in diesel price of 40-50 paise per month to wipe out the under-recovery, it wasn't envisaged that there would be over-recovery. It wants to reduce diesel price to protect state-owned oil companies' market share, which may be lost to private retailers who would be selling diesel in tandem with international prices. This would be the first reduction in diesel rates in over five years. Diesel rates were last cut on January 29, 2009 when they were reduced by Rs 2 a litre to Rs 30.86. Since then rates have only increased as international oil prices climbed. Since January 2013, diesel prices have been raised by up to 50 paise a litre every month to eliminate under-recoveries. Like diesel, state-owned oil companies had also not changed petrol rates on September 16 though it warranted a 54 paise increase as its benchmark gasoline rates had firmed up in international market. This is perhaps the first time that retail prices of diesel in India are higher than global rates. Oil companies calculate the desired retail selling price of petrol and diesel on 1st and 16th of every month based on average international benchmark price and rupee-dollar exchange rate. As per this practice, a revision is due today. Originally, petrol and diesel prices were deregulated in April 2002 when NDA government was in power. Administered pricing regime, however, made a back-door entry towards the end of NDA regime in the first quarter of 2004 when crude prices started inching up. Congress-led UPA controlled rates as international oil prices went through the roof. In June 2010, however, it freed petrol price from its control and rates have since them moved more or less in tandem with cost. In January 2013, the UPA decided to deregulate diesel prices in stages through monthly 50 paise a litre increases. Rates were last raised on August 31 after which losses have been wiped out. Rates have cumulatively risen by Rs 11.81 per litre in 19 instalments since January 2013. (PTI)
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The Tamil Nadu government on Friday announced a populist "Amma Cement Scheme" under which it will procure cement from private manufacturers and sell them at Rs 190 per bag in the wake of possible increase in rates of the key construction component.The scheme, named after Chief Minister J Jayalalithaa, who is addressed as "Amma" (Mother) by her supporters, follows similar efforts like the Amma Canteen and Amma Mineral water, all low-cost initiatives.Jayalalithaa said she had recently discussed with officials the situation regarding production of cement from the state and supply from outside.The erstwhile united Andhra Pradesh contributed about 4-4.5 lakh tonnes of cement for Tamil Nadu's monthly average use of 17-18 lakh tonnes, but the companies there had now hiked the prices by Rs 80-100 per bag, she said."Subsequently, the supplies to Tamil Nadu had reduced to around 1.50 lakh tonnes to 3 lakh tonnes, creating a favourable situation for the private manufacturers here to increase price of cement," she said in a statement.Therefore, she had directed officials to roll out the "Amma Cement Scheme" aiming to benefit the lower and middle classes, wherein the government will procure two lakh tonnes of cement from private manufacturers every month and sell them through all urban and rural local bodies at Rs 190 per bag.Beneficiaries are eligible for a maximum of 750 bags for 1500 sqft, and the cement could be bought by submitting the government approved building plan or the road plan, she said.Those wanting to buy cement for repair and renovation are eligible for 10 to 100 cement bags, she said.Tamil Nadu Cement Corporation will be the nodal agency while the scheme will be implemented by Tamil Nadu Civil Supplies Corporation and Rural Development Department through their 470 godowns, the Chief Minister said.The scheme will also cover the state's Green House and Central government's Indira Awas Yojana, she said adding, it will help ease the burden of lower and middle class in constructing a house.(PTI)
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JSW Energy Ltd said on Thursday it had agreed to buy three operating power plants from Jaiprakash Power Ventures Ltd, as it looks to expand its portfolio beyond coal and lignite-based plants.JSW Energy, controlled by billionaire Sajjan Jindal, will acquire two of Jaiprakash's three hydropower plants in Himachal Pradesh and a thermal power plant in Central India, the company said in a statement.The three plants together have a combined capacity of 1,891 megawatts, according to the statement.Jindal, speaking to a television channel, said that the financial terms of the deal were still being worked out, but the deal was "probably the largest in India's power sector to date".In July, a consortium led by Abu Dabhi National Energy Co pulled out of a $1.6 billion deal for the two hydropower plants, citing a change in business strategy.Like many power and infrastructure companies, Jaiprakash, and parent Jaiprakash Associates Ltd, have been trying to sell assets to pay down the large debts they racked up before a prolonged economic slowdown squeezed revenues and hit profitability.The JSW announcement comes a day after Jaiprakash said its deal to sell its hydropower business to Reliance Power Ltd had collapsed due to a "difference of commercial aspects".The news of the Reliance deal falling through sent Jaiprakash Power's shares down 14 percent, while parent Jaiprakash Associates shares plunged 19 percent on Thursday.Local television channels had earlier reported that JSW was buying all three of Jaiprakash's hydropower plants.(Reuters)
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