Bharat Petroleum Corp (BPCL) has offered a kerosene cargo, turning seller for the first time, to export surplus capacity as domestic demand wanes, industry sources said on Tuesday, 12 March, 2013.The state-owned refiner has offered 15,000 tonnes of kerosene for loading from Kochi over March 27 to March 29 in a tender that closes on March 14, they said.India's usage of kerosene - used domestically as cooking - has falen as it is gradually replaced by liquefied petroleum gas (LPG).The Petroleum Planning and Analysis Cell (PPAC), a unit of the oil ministry, lowered India's kerosene demand growth by 9.5 percent to 7.45 million tonnes in January for the current fiscal year ending March 2013.It increased growth for LPG by 5.6 percent to 16.22 million tonnes."Normally the kerosene produced in state-owned refiners are used for domestic consumption, but this has been slowly reducing as people switch to cleaner LPG," the India-based source said.Kerosene exports could become regular, the source added.This was also likely the first kerosene export by an Indian state-owned refiner, a second source said, though this could not immediately be confirmed. (PTI)
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Shell India on 12 February' 2013 described as "absurd" the demand for $1 billion in taxes on a $160 million equity infusion done by the Anglo-Dutch oil major four years ago, saying it tantamounted to tax on FDI. Anglo-Dutch oil major Royal Dutch Shell Plc's India unit head Yasmine Hilton said the company will challenge the notice that alleged tax evasion by under-pricing share transfer between member firms. "We never comment in public about our tax affairs. The only reasons, and absolutely the only reasons, we commented on the issue was because it was reported that Shell was evading taxes. I cannot have our reputation tarnished that way. Shell does not evade taxes. At Shell, we have the highest business principles," she said. Hilton said the tax authorities have raised a tax demand of $1 billion (about Rs 5,400 crore) on an equity infusion of $160 million (about Rs 870 crore). "To service the downstream business, which is not making money, we needed an equity injection in 2008 of $160 million. We have (now) received a tax request of $1 billion on this equity injection of $160 million. Somebody needs to explain (this) because I do not understand," she said. Income tax department has charged Shell India of under- pricing a share transfer within the group by Rs 15,220 crore, and consequently evading taxes. The order relates to the issue of 8.7 crore shares by Shell India to an overseas company Shell Gas BV in March 2009. The shares were issued at Rs 10 a share, which the income-tax authorities contest and peg higher at Rs 183 a share instead. She said in order to pay $ 1 billion in taxes, the company will need another equity infusion as the downstream fuel retailing business is loss making. And on that equity infusion, the company may get a $3 billion tax demand. "Just think about the absurdity about it". o attract global giants, India needs to send right signals that it has a stable fiscal, legal and tax regime. "Lets have a robust investor friendly framework. Do not create waves of fear amongst your investors by unreasonable tax demands or unreasonable statements. What signal does it send," Hilton said. Shell, she said, will review all its options. It is taking tax and legal advice on the issue, she said but refused to say at what forum would it challenge the tax demand. "It is effectively a tax on FDI," she said. "We do need the right signal that India is going to be stable fiscal, legal, tax regime. We are not going to have surprises along the way." Last week, Shell in a statement vowed to challenge what it saw as a transfer pricing order that is "based on an incorrect interpretation of the Indian tax regulations and is bad in law," arguing that the move is a capital receipt on which income tax cannot be levied. At the centre is a 2009 equity injection involving Shell India and parent Shell Gas in which around Rs 870 crore worth of shares were issued at a value of Rs 10 per share, stock which taxmen now claim was in fact worth Rs 183 per share. "Funding of a subsidiary through issue of shares is common in India and globally," Shell India said. "Taxing the money received by Shell India is in effect a tax on Foreign Direct Investment (FDI), which is contrary not only to law but also to the spirit of the recent global trip by the Finance Minister to attract further FDI into India," Hilton was quoted in last week's statement as saying. The statement said Royal Dutch Shell group has over the last few years made significant investments in India. Equity injection was used to finance these investments and to fund the ordinary business activities of Shell India. (PTI)
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Kotak Mahindra Bank has raised about $90 million for a dedicated fund to invest in infrastructure sector, the company said in a statement on 12 March' 2013. The fund, Core Infrastructure India Fund Pte Ltd, will invest in companies engaged in industries like power generation and transmission, transportation, water treatment and supply, waste management and gas transmission in India, Kotak said. Japan's Sumitomo Mitsui Banking Corp, an affiliate of Brookfield Asset Management, Japan Bank for International Co-operation are the other main investors, in addition to Kotak Group, the statement said.(Reuters)
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State-run producer Oil & Natural Gas Corp reported a 17 per cent fall in quarterly profit, but beat expectations, helped by higher sales and nearly flat subsidy provision.The company reported a net profit of Rs 5,563 crore for its fiscal third quarter ended December, down from Rs 6,740 crore a year earlier, which had included a one-time gain on account of royalty dues from a joint venture partner.Analysts on average had expected the company to post a net profit of Rs 5370 crore for the quarter, according to Thomson Reuters Starmine data.Net sales rose 16 per cent to Rs 20,987 crore.Shares of ONGC, India's third-biggest company by market value, closed 1.7 per cent lower on Monday, 11 February ahead of the results. The stock has jumped 15 percent so far in 2013, outperforming a 6 per cent rise in the sectoral index.(Reuters)
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Ending weeks of stalemate, the Defence Ministry has cleared Reliance Industries' producing KG-D6 block and gas discovery area NEC-26 along with most of the areas where it had either barred any oil and gas activity or put stringent conditions. In all 8 blocks, including RIL's Krishna Godavari basin KG-D6 block and gas discovery area of NEC-25 in the North East Coast (NEC) region, were declared "No-Go" zones for reasons like overlapping with proposed Naval base or being close to missile launching and Air Force exercise area. Stringent conditions were put for another 32 exploration areas. At a meeting taken by National Secretary Advisor Shivshankar Menon and Principal Secretary to Prime Minister Pulok Chatterji on February 27, RIL blocks were fully cleared for exploration and production and stringent conditions for most of the 32 other blocks relaxed, sources said. RIL's KG-D6 was fully cleared for oil and gas activity with the total area of 7,645 square kilometre reduced by 495 sq km to meet defence needs, sources said. Similarly, its NEC-OSN-97/2, where six gas finds have so far been made, was fully cleared with the "hold harmless" clause for any accidental debris. RIL's KG-OSN-2001/1 was also cleared but the block had already been relinquished by the operator. However, state-owned Oil and Natural Gas Corp's (ONGC) KG basin blocks KG-OSN-2005/1 and KG-OSN-2005/2 and BG Group's KG-DWN-2009/1 would remain No-Go areas as they fall directly within the boundary of the proposed naval base, sources said. For Cairn India's KG-OSN-2009/3 and ONGC's KG-OSN-2009/4 blocks while DRDO was willing to clear these with some conditions or with reduction in the area of the latter, there were issues to be resolved with IAF. They fell within IAF's Suryalanka Guided Weapon Firing Range (GWFR). Sources said it was agreed that the Defence Ministry will re-examine the matter with IAF, considering that there is high probability of finding hydrocarbons in these blocks and finalise in two weeks. Sources sid of the 32 blocks with stringent conditions, 15 where DRDO clearance was needed, were cleared with some conditions. 17 blocks for which Navy had given conditional clearance earlier have now been cleared by Navy without any conditions. Further, out of the 11 block which were conditionally cleared by IAF earlier, five areas have completely been cleared and one block cleared with a 10 per cent reduction in area. The remaining five blocks have been cleared fully for exploration up to 2016 in portions overlapping with defence facilities. Ministry of Petroleum & Natural Gas would prepare and submit a note for consideration of the Cabinet Committee on Investment within two weeks, they added. Sources said the change of heart came as Oil Ministry pushed very hard saying KG-D6 block has been producing oil since September 17, 2008 and gas from April 1, 2009 after obtaining all requisite approvals. For NEC-OSN-97/2 (NEC-25), the Oil Ministry aggressively stated that six discoveries made in the block could not be exploited because of lack of clearance. (PTI)
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Imagine this: a home to call your own that is situated in the lap of nature; a lush abundance of greenery all around you; walking and jogging tracks where you and your pet are both welcome; a community hall where weekends are spent catching up with family and neighbors; a shopping market where all your daily needs can be bought under one roof.Now imagine that all this comes with a carbon-free existence. No need to worry about leaving carbon-footprints behind you, as you go about your daily chores. In fact, to take it further, imagine living in a space that has been built with a green conscience.India’s perennially-mobile working class population ensures that the country’s infrastructure is always under pressure. From water shortage to unemployment; from sanitation woes to the mismatch between demand and supply of housing – our urban planners are always in a fix to constantly provide basic amenities to its billion-plus population.Consultancy firm Boston Consulting Group estimates that by 2020, 35 per cent of our population will have moved to cities, whether in search of employment or education.Now imagine each of these million souls looking for a house that they can afford that too in our metros.Their needs and desires put them in a category of ‘Urban Aspirers’ – those living in cities and aspiring to climb the social/professional ladder.Exorbitant real estate prices might mean that buying a house might just remain a dream for these aspiring millions!In fact, the Ministry of Housing and Urban Poverty Alleviation (MHUPA) estimates that the housing shortage for the 11th Five Year Plan will be 26.53 million dwelling units.Will these million people spend the next 30 years of their young, working class life living under rented accommodation, spending half their income on a house that barely looks like one?The answer lays in Integrated Township, a concept where mix land use provides a solution to the problems of these souls.Living With HumanityGiven that our cities will be under so much pressure from this sea of urbanisation, planners and developers together need to recognixe the importance of integrated townships in our city-limits. The appeal of integrated townships lays in the fact that it puts affordability, convenience and focus on lifestyle in one very attractive package. In cities like Mumbai, where public transport is strong, previously far-flung areas like Boisar are now becoming easily accessible and the chosen area to reside for this aspirer population.So a housing society can enjoy, community hall, playgrounds, green landscaped seating area, shopping markets, jogging tracks, parking spaces, rainwater harvesting, bus connectivity to main bus stops, railway/metro/mono rail stations and more.Research suggests this mixed land use policy will emerge in the future. Mixed use for urban infill sites create jobs and cater to the residential requirements. Integrated townships having a good mix of employment opportunities offer residents a walk-to-comfort. A mixed-use development is not a standardised product form, but due to high land costs in the urban settings most developers are setting up integrated townships in the suburban locations. Factors making the mixed-use development popular from the developer’s perspective are:Convenience of live-work-play options in a single locationSatisfying the desire to live in more of a small-town (e.g. "Main Street") environment.Reducing traffic congestion Encouragement by local public agenciesSustainable LivingA point to consider here is that such large-scale urbanisation brings with it a number of evils. Take a simple object for further explanation: the ubiquitous plastic bag that every individual walking on the street has used in some form or other.Or the usual yellow-coloured lamps that almost every household has. Now multiply this one bag into a billion-plus population that is using it every day, maybe 5 times a day. The resultant number is downright scary.Similarly, each industry leaves behind its legacy of such carbon lamps or plastic bags. It is with this urban reality, that developers are now recognizing the importance of integrated sustainable townships. A township which has the above-mentioned facilities yet is built to leave behind zero carbon foot prints.The real estate industry has developed a concept of ‘sustainable design', wherein an integrated approach is adopted, in order to deliver holistic projects to consumers. The importance of Sustainable Development is gaining recognition and developers are increasingly adapting green practices, thereby bringing-in environmental benefits in a holistic way to communities. The main objective of Sustainable Green Design is to avoid depletion of natural resources and prevent environmental degradation caused by facilities and infrastructure.While some buildings are pre-certified based on conformance of design specifications and best practices, several organisations also approve buildings only after rigorously documenting the occupancy phase. The building phase is monitored closely to ensure there is minimal damage to nature. This includes mandates like net-zero energy and water use, which must be maintained over the full trial year of occupancy; monitoring the use of banned material including halogenated flame retardants, PVC plastics, and chlorofluorocarbons. All environmental conscious SSOs and SDOs like LEED (Leadership in Energy & Environmental Design), GRIHA (Green Rating for Integrated Habitat Assessment) and IGBC (Indian Green Building Council ) have aided in developing technical and safety standards.Living with HUMANITY and living WITH humanity can come to mean the same thing in such integrated sustainable townships. (The author is Mr. Brotin Banerjee, MD & CEO, Tata Housing)
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The government will pay Rs 25,000 crore additional cash subsidy to state-owned fuel retailers to make up for part of the revenue they lost on selling auto and cooking fuel below cost this fiscal. The Finance Ministry on February 7 issued a "comfort letter" to Indian Oil Corp (IOC), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) sanctioning Rs 25,000 crore for part of the revenue they lost on selling diesel, domestic LPG and kerosene below cost, official sources said. Previously, the government had released Rs 30,000 crore subsidy. With the latest sanction it has met about 44 per cent of the Rs 124,854 crore revenue the three firms together lost on selling auto and cooking fuel below cost during the April-December period this fiscal. Of the latest sanction, IOC would get Rs 13,474.56 crore, BPCL Rs 5,987.25 crore and HPCL Rs 5,538.19 crore. Sources said the Finance Ministry has only issued a comfort letter which the oil companies will account as receivables to post decent third quarter earnings. Actual cash will flow only after Parliament approves supplementary demands for grants or additional spending. IOC, BPCL and HPCL lost Rs 39,268 crore in revenue on selling diesel, LPG and kerosene at government controlled rate in October-December quarter. Of this, about Rs 15,000 crore will be made good up upstream firms like Oil and Natural Gas Corp (ONGC) and Oil India Ltd. Fuel retailers currently lose Rs 9.22 a litre on diesel, Rs 31.60 per litre on kerosene and Rs 481 on every 14.2-kg LPG cylinder. They lose Rs 443 crore per day of sale of the three fuel. The Finance Ministry pays cash subsidies to state oil retailers while state-run upstream companies - ONGC, OIL and GAIL India Ltd - sell crude oil and products like LPG products at a discount. From the previous Rs 30,000 crore dole, IOC had got about Rs 16,100 crore, while HPCL and BPCL's was about Rs 6,670 crore, and Rs 7,200 crore respectively, sources added. Upstream firms have till now paid Rs 45,000 crore in fuel subsidy. (PTI)
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Essar Energy said an expansion in refining capacity and the ability to better process lower-cost heavy crude oils helped firm up refining margins in the third quarter. Essar Oil, India's second largest private refiner, said current price gross refining margin rose to $9.75 per barrel at its Vadinar refinery in the western Indian state of Gujarat, up from $2.82 per barrel last year. Refining margin at its Stanlow refinery in the United Kingdom rose to $5.59 per barrel from $2.45 a barrel a year earlier. The company's oil refining unit, Essar Oil, said last month that EBITDA grew over 8 times to 12.42 billion Indian rupees ($231.95 million) for the quarter. Margins at Vadinar rose thanks to an expansion of refining capacity to 405,000 barrels per day from 300,000 barrels, combined with an increased ability to refine heavier low-cost crude oils into high-value products like diesel and jet fuel. At Stanlow, margins rose as the company improved current-price refining margins by $1 per barrel. Essar is aiming to improve current-price refining margins by $3 a barrel by 2014. Essar Energy, 77 per cent-owned by privately held Indian conglomerate Essar Group, also said it was working towards meeting conditions laid down by India's federal government that would allow it to mine coal from the Mahan coal block in the central state of Madhya Pradesh. The company received forest clearance for the Mahan coal block in October, bringing Essar a step closer to supplying coal to its captive power project in Madhya Pradesh. Shares in the company were up 2 per cent at 144 pence at 0810 GMT on the London Stock Exchange on Monday. (Reuters)
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