India Petroleum Update

Bangladesh to be bypassed for Myanmar gas

India just might call Bangladesh's buff in the Myanmar-India pipeline deal. In addition to a rather high $125 million transit fee, Bangladesh was asking for free access to Nepal and Bhutan, for allowing India to use its territory to get a gas pipeline from Myanmar (where India owns gas equity in some pretty lucrative fields).

If India decides to build the pipeline in its own territory, the length and hence cost increases, but the transit fee saving compensates for that. In addition it will allow gas from the North Eastern states to be sold to the rest of India, proving a boon for those states. Why did anyone think of Bangladesh in the first place? :)

YAOCOC (Yet Another ONGC-Chinese Oilco Confrontation)

Another Canada-based company that ONGC will fight it out with a Chinese company to takeover. This one is called Petrokazakhstan, and as the name suggests it has huge interests in Kazakhstan. This property is expected to be on the agenda when Chinese President Hu Jintao visits Kazakhstan today for talks. China has huge advantages here as it already has some oil equity (unlike India) and is in the process of building an oil pipeline from that country to China. Of course ONGC and the Chinese CNPC are not alone. Among others there is Chevron Corp with which another Chinese company is in battle for Unocal.

Pakistan has meanwhile refused to buy diesel from India. Pak had agreed to consider the proposal, after Aiyar's recent visit to that country. Even though petroleum product prices in India are much higher than in Pakistan, the reasons for refusal on grounds of cost remain flimsy.

India's oil reserves

When India's oil reserves were last assessed almost 10 years ago, the estimate was 30 billion barrels. A re-assessment is being planned and the results should be interesting.

Follow-up on India's Biggest Gas Find

Size Disputes

First the Indian Director General of Hydrocarbons, VK Sibal, and then the Canadian partner in the consortium, GeoGlobal Resources, came out against the size claims on the find. Both said that current data is rather premature to decide the size of a reserve.

Trivia and Implications

Apparently GSPC almost did not get to bid for the K-G Basin block back in 2002, and Gujarat had to increase the net worth of the company by Rs 300 crore within 48 hours at the height of the Akshardham crisis.

Here are some calculations on possible implications on other gas projects in India.

The deal with Iran is to import 5 tonnes of LNG every year. This works out to 13,700 tonnes a day, which is slightly less than 19 million cubic meters per day.

As per current plans, in 2008 (2006?), Reliance will start commercial production of a little over 14 million cubic meters (mcm) of gas per day, from their KG Basin find. Estimates say that this could go up all the way to 40 mcm per day - within months. The ONGC find in the KG basin stands between 4 and 8 tcf (Reliance's is anywhere between 9 and 14 tcf) based on who you ask. So ONGC could produce another 10 mcm. The GSPC find at current estimate stands at a giant 20 tcf. But because it is from older sediment, compared to the Reliance find, the ultimate flow per day would be around 40-50 mcm per day. Cairn also made a 1 tcf find in the KG Basin.

So sometime around 2009, when the pipeline from Iran would start bringing gas to India, the KG Basin will be supplying almost 100 mcm of gas to Indian consumers everyday, at competitive and maybe even lower cost. By then Iran (7.5) and Qatar(10) together could be supplying India almost 17.5 mcm of gas per day in the form of LNG. Piped gas is about 40% cheaper than LNG, and if we include the Iran pipeline, it looks like there will surely be a shortage of demand for LNG in the country by then. Also consider this then.

Follow-up on Friedman's Geo-Green Strategy

Here is an interesting post from TreeHugger, especially when seen as a follow-up to the post on Friedman's Geo-Green Strategy. In that post we looked at Friedman's analysis stating that all the technologies to make the US independent of oil imports are already here and only need implementing.

Well the TreeHugger post points to paper that was released to influence the US Senate's debate on the Energy Bill - to try and get subsidies for renewables instead of for fossil fuels. The paper reiterates the same points that Friedman makes - promote plug-in hybrids and bio-fuels. In addition to these points the paper also mentions improving the mileage of all new vehicles (which in case of Friedman's analysis came in as part of using hybrids).

What is interesting though it the TreeHugger comment in the end: "Of course, nothing here is a solution to the end of oil; if implemented, these things wouldn't give us a sustainable post-oil society, but things would still be better than with the current situation...". I hope this was a casual statement and not based on solid costing.

Reliance going green?

In the post titled Reliance's Power Play, which was basically a round-up of Reliance Energy's big ambitions in the power sector in India, I mentioned that given its track record, Realiance was unlikely to go green like Godrej and Ramco for example. Two things happenned after that, that made me reconsider that idea.

The day of the Reliance Split, Anil Ambani was addressing a press conference live on several channels. During what was looking like a great public wooing exercise, he slipped in that REL remains committed to non-conventional sources of energy - and he only mentioned solar and wind. Solar sounds nice, but mentioning wind obviously meant he was serious. Now a lot of Reliance's foray into the energy sector was based on RIL's oil and gas finds. Thus the biggest-of-its-kind gas plant in UP, and a proposal for a bigger one in Maharashtra. The first indication that there was a move away from oil and gas was the proposed Orissa investment in coal. So this made great sense. REL is moving away from RIL, and a future linked closely to oil and gas, which is no longer "in-house" so to say. Thus it was logical to move into wind. (Actually non-conventional sources were also mentioned at the REL AGM slightly earlier in the month too).

Next came the announcement today, that Reliance Energy and GE were setting up India's largest wind power project at 500 MW capacity, by 2007. So does this speak of a new leaf.

Not entirely. As part of the Electricity Act 2003 the government of India mandated that all power distributors ensure that a certain percentage of their power comes from renewable sources, and that just might have forced Reliance's hand. Also, despite the size of the investment relative to others in the industry, it would provide a very small percentage of the total power Reliance plans to produce and/or distribute in the near future.

Anayzing India's Biggest* Gas Discovery

History

It was a well-contested block, when it was put up for bidding "way back" under NELP-III (third round of National Exploration Licensing Policy). The last date of submission of bids was 28th August 2002, while Reliance announced their find only in November 2002. Going by industry rumour, that find was originally ONGC's. Even discounting that rumour, it is very likely that having already explored the area both Reliance and ONGC knew the area very well. Thus the winning bid was a surprise. For the record, ONGC and Reliance are likely to win all K-G Basin blocks on offer under NELP-V.

Drilling operations started on July 31, 2004. After abandoning the first two wells at depths between 2600 and 2900 m, the third well was spudded on January 17, 2005. The reserve was confirmed at a depth of 5,061 m.

Venture Partners

Joint ventures are usually the norm in the upstream oil sector. So GSPC is actually a part of a consortium and owns 80% of it. The rest is held by GeoGlobal Resources of Canada and Jubilant Enpro of Noida, India. The smaller partners generally bring in expertise and are likely to sell out by the time production is commercialized.

Future Plans

News reports claim that GSPC wants to get the gas onshore by 2007. Reliance plans to start production in August 2006, though they started out over 2 years ago. But then drilling three wells of those depths within 300 days is also a record of sorts. To commercialise production, GSPC needs Rs 1,500 crores and an IPO is planned (expect a stampede soon!). Currently the Gujarat government owns 99% of GSPC, while a British Gas subsidiary Gujarat Gas owns the remaining 1%. The government is likely to divest 20% of the company within 6 months. GSPC had been earmarked for divestment even before this find.

GSPC intends to drill four more wells, and tenders have already been floated for these. Drilling is scheduled to start after the monsoons.

Implications

This find can have likely impact on a range of gas deals for India from the proposed pipelines to LNG import to domestic pricing. Need to do some research (or find a news article with figures I can simply validate!), but I'll be back on this, hopefully, soon.

* While most media reports seem to agree that this is India's biggest find ever, this report from ET states that the Bombay High find (Vasai offshore), way back in 1976 was still bigger at 22-24 tcf. But even ET agrees that it is probably the biggest find in the world in the new millenium.

India Petroleum Update

India's Biggest Gas Find

The Krishna-Godavari Basin, that threw up the 14 trillion cubic feet (tcf) gas field for Reliance in 2003, has done it again - this time for relatively puny old Gujarat Petroleum. To be honest, GSPC has been attracting a lot of media interest of late, but nothing can beat this $50 billion addition to its asset list. The gas find is worth about 20 tcf, which is two thirds of Bangladesh's proven reserves.

As more details of the reserves pour in, it should be interesting to note the worth of the oil leg in this find, which could be decent too.

The Gujarat CM, Narendra Modi, revelled while announcing this to the press a short while ago, and went on to name the project, "Deen Dayal" or "Saviour of the poor".

Doubts are already being cast on the viability of the scheduled incoming pipelines. Similar doubts were cast after the Reliance find too - even then though the Reliance group itself remained firmly in favour of the pipeline.

Domestic Petro-product Pricing

The other big happenning this week was the price hike of petroleum products. Petrol was made dearer by Rs 2.50, and diesel by Rs 2.00.

As volatile as that decision to increase prices was, petrol pump owners were not impressed. They went on strike demanding higher commissions - which would naturally have to passed on to the consumers.

Gas for Dabhol

With the Dabhol plant all set to resume operations, India is now looking towards Qatar for additional supplies of LNG. This is in addition to the 5 mtpa Qatar is already supplying, and the additional 2.5 mtpa for which negotiations are in progress.

Tailpiece

After Bangladesh, illegal diesel imports are finding their way into India now from Nepal.

Freeing India of Oil Imports

After the post based on Friedman's article on reducing American dependence on imported petroleum, here is one on reducing Indian dependence on imported oil and gas altogether.

This was written by Arun Firodia, Chairman of the Kinetic Group, and was published last December. The article envisions an energy independent future for India based on methane gas from cow dung (from our 250 million cows), and bio-diesel from massive Jatropha plantations.

Weight-wise methane gas matches the calorific value of petrol, LPG or kerosene, and an average cow in India can produce enough dung to produce 225 litres of methane gas in a year.

Replacing LPG and kerosene

Estimating a per capita annual LPG and kerosene consumption of 15 kg each, for the urban and rural populations, just 75 million cows would produce enough methane (16.8 billion litres) to meet the LPG and kerosene requirements of 1 billion Indians (15 billion litres).

Replacing Petrol

40 million cows can produce enough methane to easily replace the 8 million tonnes of petrol India consumed in the year 2003-2004. Like CNG, methane can easily replace petrol in automobiles.

What about Diesel?

Jatropha! on just 15 million of our 25 million hectares of waste or fallow land, will produce at least as much bio-diesel as India's annual consumption of diesel.

All figures are from the original article. Though the figures seem exhaustive, and the article also gives more insights into the production of methane gas (or gobar gas) there isnt enough dwelling on the costing factors, which at least in the case of bio-diesel is still critical. The point being made is very valid. Imagine the potential for a country like New Zealand which has far more lifestock than human beings!

Update: Indra had posted on this article some time back. Some useful comments are available on his site.

Friedman's Geo-Green Strategy

Sunil pointed me to this excellent editorial by New York Times Op-Ed columnist, and much celebrated writer, Thomas L. Friedman.

Outlining what he calls geo-green strategy he talks of ridding the American economy of its addiction to and dependence on oil. Most importantly he states that the technology to that utopia is already available, and a lot of it has already been commercialized successfully.

Plug-in hybrids can ensure that 50% of Americans do not use petrol at all for their daily use. Those that do will get a mileage of 100 miles per gallon (210 kmpl). Step two would be using flex-fuel cars that can run on ethanol, petrol or any combination of the two. So a hybrid running on an 80-20 mix of ethanol and gasoline will practically give 500 miles for every gallon of gasoline.

As Friedman puts it, "In short, we don't need to reinvent the wheel or wait for sci-fi hydrogen fuel cells. The technologies we need for a stronger, more energy independent America are already here. The only thing we have a shortage of now are leaders with the imagination and will to move the country onto a geo-green path."

Energy Independence via Swadeshi

Gandhiji's Swadeshi movement broke the economic back of British Rule in India. The essence of the movement was that everyone invest a little time everyday to make whatever cloth they needed, and hence close the market for British textiles in India. The closure of the giant Indian market led to the shutting down of mills in England, but more importantly the poor Indians felt a little more self-sufficient, self-reliant and a little richer too.

In an excellent post, Gmoke points out that, "this type of practical labor has to be the core of any sustainable ecological action".

Look at it this way. Gandhi used swadeshi, as what we shall call Sustainable Ecological Action, to make cloth, which in some ways was the life blood of the economy then. In the different world that is today, what cloth no longer has that position. So what does? In a lot of ways it has to be energy. Fossil fuels like oil, coal and natural gas, and renewables like solar, hydel, tidal and wind - all of these have only one thing in common - they give energy. And without energy their importance reduces to almost nothingness. So if Gandhiji were to start a Swadeshi today, he would choose to create energy instead of cloth.

Here is what Gmoke suggests:

In this "deregulated environment" with oil used as a weapon and national security identical to energy security, direct ecological and economic action toward renewables and away from the nuclear, gas, coal, and oil that we presently use can be a primary political as well as economic act. A treadle/pedal/crank powered generator with a flywheel can be the solar swadeshi, an ecological and economical electrical charkha.

One humanpower is about one sixth horsepower. A healthy person can put out 100 watts of power for hours on end and 300 watts in a sprint. Let's not be batteries in the Matrix but generators in a net metered ecological Network.

The ultimate goal I envision is to meet all electrical non-space-heating and refrigeration needs within the space of one south-facing window (4-10 square feet of photovoltaics) and a half hour to an hour a day's human power. The realistic goal today is most of the electrical load with the exception of refrigeration and space-heating: lighting, TV, audio, computer, phones...

This isn't Edward G. Robinson in "Soylent Green" pedalling a broken down three speed to light one sickly incandescent bulb. This is more like Lance Armstrong powering his energy efficient Spanish villa with a morning workout on his state of the art Tour de France simulator stationary bike and power generator.

India Petroleum Update

The Indo-Iran LNG Import Deal

The big deal was finally signed. Here is a quick reckoner for those interested in the line item details.
1. A consortium of state-run firms are representing India, while the National Iranian Gas Export Company (NIGEC) is representing Iran.
2. Iran will sell India 5 million tonnes of LNG every year for 25 years starting 2006. The size of the deal would be between $18 to $22 billion. Discussions for an additional 2.5 million tonnes per annum (mtpa) were postponed to, "after the polls".
3. At $3.515 per mmbtu, the price is 26% higher than the price fixed with Qatar, while the price of oil has almost doubled in the time between the two deals. The gas from Qatar however is rich gas, which Iran has a policy of not exporting. Though the Iranian gas will not be stripped of ethane before export, it is still not clear if the gas will be stipped of other chemicals or not.
3. ONGC Videsh Ltd gets full operatorship of the Juffier exploration block, though only 10% of Iran's biggest producing field - Yadavaran. The deal is worth 60,000 barrels per day to India. Another 10% could be given after the discussions on the additional 2.5 mtpa are complete. The initial deal suggested was that India would pay market price for this oil, and I am not sure that has changed - in which case it is a very minor victory indeed.
4. IOC-OVL get an exploration block in the possibly very rich North Pars gas field.
5. IOC will team up with Iranian Petropars for an LNG and petrochemical complex. IOC is also pushing for another 9 mtpa deal with Petropars.

The Indo-Iran Pipeline Deal

The "heads of agreement" has been signed. An official level special joint working group has been set up by India and Iran, to thrash out financial, technical, legal and commercial issues. The first meeting will be in New Delhi on June 23-24. The Indo-Pak joint working group (formed this month) will meet in New Delhi in July.

Once again, the inclusion of China in the Indo-Iran pipeline project was discussed. Extending the pipeline beyond India, and especially into China is wonderful for two reasons: India gets transit fees to easily offset the transit fees being paid to Pak, and energy security is enhanced, as Pak would hardly dare cut supplies to China even in case of hostilities with India. On the face of it, all parties have expressed willingness to go ahead at various levels.

Scenting the NELP-V winners

Phoenix Overseas, a near unknown in the oil industry, and better known as an arm of Phoenix shoes, might win one of the most prospective blocks under NELP-V. The block in Rajasthan is spread in three districts, and Phoenix was quizzed on its proposed drilling details under the exploration program. This is seen as a strong indication.

Otherwise the status remains the same - ONGC is likely to win 10 out of 20, while Reliance will get at least 2, and maybe even 9.

Though it is likely to draw a blank under NELP-V, the world's largest oil and gas company, Total might enter the refinery sector in India in a big way, en route a retail entry. More correctly the refinery entry is near mandatory to enter the retail sector.

Cairn continues to trumphet its commitment to the Indian oil exploration story by saying that it hopes to, "discover and land several billion barrels of oil", in Rajasthan. Maybe it was just euphoric over this. Good for us anyway.

From Greenhouse Gasses to Oil

The Kyoto Protocol mandated cuts dictate a cut in emissions - not a cut in production - of greenhouse gasses. Some countries are thus planning to collect the CO2 being produced by their industries, and store it under ground.

Citing the experience of Norwegian firm Statoil which has been storing CO2 below the seabed in a gas field, Britain believes doing this could cut upto 85% of emissions from power stations, and wants to help other countries adopt this technology too as and when it is available.

"The move comes as Britain prepares to put climate change issues center stage at next month's G8 Summit at Gleneagles in Scotland."

The technology is expected to be available in a decade. Further pumping in the gasses into depleted oil and gas fields is also likely to increase yield from the fields.

This is a good initiative. While it is not a pure-play clean-green technology, being as far as we are from Utopia we have to cling on to as many logs as we can. Energy efficiency is one. This is another.

Brazil's Huge Experiments with Bio-fuels

GCC links to this article in the BBC titled, " The rise, fall and rise of Brazil's biofuel". The history of bio-fuel usage in Brazil presents an excellent case study for economies (including India) that are today trying to move towards bio-fuels in a big way.

The Rise

In a politically inspired decision, Brazil's military dictatorship decided to reduce dependence on Middle Eastern oil (probably as a reaction to the oil price hikes in the 1970's). Thus was started a program to use ethanol made from sugar-cane, which was plentiful in Brazil, as a substitute for petrol in motor vehicles. The program subsidised farmers for growing sugar-cane, subsidised ethanol at the pumps to actually make it cheaper than petrol and ensured mass production of vehicles that ran on ethanol instead of petrol.

"As a result, in 1985 and 1986, more than 75% of all motor vehicles produced in Brazil - and more than 90% of cars - were designed for alcohol consumption."

The Fall

Then a combination of factors brought down the curtains on this major technological feat. The military government fell in 1985, and so did concerns of "national security". Oil prices fell steeply from their 1970's highs, while sugar prices rose (making ethanol also more expensive), and finally Brazil discovered huge internal reserves, thus vastly enhancing oil self-sufficiency.

Despite the great environmental benefits, production of ethanol powered vehicles fell to just 0.06% of production in 1997.

The Resurrection

That was about when ethanol and bio-fuels in general were getting popular in the US, encouraged by President Bush's vision to grow fuel instead of digging for it. This was of course helped by the fact that oil prices were rising steadily.

The big technological break came in 2003 when flex-fuel cars entered production in Brazil. Flex-fuel cars can run on petrol, ethanol or any blend of both, aided by an on-board computer that monitors the quality of the fuel and makes appropriate adjustments.

"In 2004, the first full year that "flex-fuel" cars were on sale, they accounted for more than 17% of the Brazilian market, and are on course for an even bigger share this year."

Appropriately more companies are adding flex-fuel cars to their offerings, and they are not all local companies.

The good news is other countries, including the US, are beginning to give Brazil a tough fight for its leadership in the crop-based motor fuel space. Like in any other renewable energy source, the bio-fuel resurgence in Brazil was a result of tax breaks and technological advancement - the tax breaks do the hand-holding till the technology is mature and strong enough to fend for itself.

Eliminate Garbage, Produce Oil

We have seen Power from Garbage initiatives before, but nothing on this scale for sure.

Via Trends... and Joe Kissel:

US company Changing World Technologies, has managed to make Thermal Depolymerization work to produce oil, using the same process that nature takes some millenia to, in a few hours. In nature, organic matter is subjected to high temperatures and pressure, and knowing this process lots of folks have replicated this model in the laboratory. The difference is till now it has not been const-effective. Changing World Technologies claims that their method can produce oil cheaper than drilling it from the ground.

The process takes any sort of organic waste, from biomass and sewage, to plastic and rubber (even tyres), and produces a vaporous gas (a mixture of methane, propane, and butane), liquid oil (similar to a mixture of gasoline and motor oil), and powdered carbon. So you have virtually no waste products.

Not all implications of this technology are clear though. It will take some detailed studies to predict whether it can replace petroleum altogether in major economies. If it can, then it might actually be a big blow against clean renewable sources, rendering them almost forever uncompetitive. Either way, it will still be a great way to treat garbage in cities, and use it to reduce dependence on fossil fuels.

India Petroleum Update

After Encana in Equador, its Pogo in Thailand, where India's ONGC Videsh Ltd is pitted against a Chinese consortium for buying oil assets. On stake in Thailand are assets worth $700 million.

IOC meanwhile has bid for controlling stake of Turkey's biggest refiner Tupras. While it does not have great mineral assets, Tupras falls nicely into the Indian PSU's strategy by allowing IOC to use its transportation and logistics infrastructure for getting oil and gas from countries in the region that it has tie-ups with.

Aiyar in Pak

On Oil minister Mani Shakar Aiyar's recent trip to that country, Pakistan was offered discounted diesel, an offer that was later enhanced to include other petrochemicals like those used to make polyester fibre and for detergents. On its part Pakistan agreed to review the diesel import policy, "when it comes up for review next". (Ironically on the Eastern border, illegal Bangladeshi diesel imports are causing IOC loss of sleep).

While Musharraf is said to have given his nod for the Indo-Iran pipeline, Pakistani papers were rife with reports of how the US was pressurising Pakistan to not go ahead with it.

Signing the ECT

Considering that 18 agreements would have to be signed for just the Indo-Iran pipeline, the benefits of signing the Energy Charter Treaty (ECT) came into focus again.

Domestic Exploration

Oil India Ltd announced three new discoveries in Assam, their main domain for exploration. While figures related to reserves are not available, the company is said to be "upbeat" about the discoveries.

Apparently of the 48 companies bidding for the 20 blocks on offer under NELP-V, Reliance and ONGC put in the most aggressive bids, and might corner all the 20 blocks with ONGC likely to get at least 10 blocks.

Aiyernomics

After organizing a buyer-seller summit between Asian buyers and Middle East producers, earlier this year, Oil Minister Aiyar is now preparing to host a meeting between Asian buyers and oil producers from the Caspian, Central Asian and Russian regions. This plays in nicely with India's new efforts to reach out for Caspian oil and gas. An Israeli pipeline could play a vital part in this strategy.

The fastest growing category of merchandise export from India was petroleum products which grew at over 90% last year. An avid fan of the EOU refinery concept Aiyar, reiterated that he would push for Indian refining capacity to promote exports. There are reasons though why Aiyar's "export blueprint" might not be such a hot idea after all.

Refinery margins are currently as high as $7-8 a barrel just because there is a huge shortage of refining capacity in the US, China and other nations. However, when this shortfall is rectified, as it will likely happen soon, the margins should fall to just $2.50. The strategy will feel the strain then. Traditionally too, refineries are generally closer to the markets, because transporting crude is much cheaper, whether by tanker or by pipeline. Otherwise only the oil producing countries would have had all the refineries in the world.

Governator goes beyond Kyoto

The Governator, as California Governor Arnold Schwarzenegger is often called, has declared war on global warming. Schwarzenegger has before taken stances on energy that are distinct from those of President Bush. For example, he has been a big supporter of the move away from oil via his support for the Hydrogen Highway and Million Solar Roofs initiatives. This time he is going a step beyond.

While the Bush administration had refused to ratify the Kyoto protocol, California is committing to outdo Kyoto in the long term.

The Governator issued an executive order that would set targets -- cut emissions to 2000 levels by 2010, 1990 levels by 2020, and 80 percent below 1990 levels by 2050 -- that are less stringent than the Kyoto Protocol's in the short-term, but one of the world's most aggressive in the long-term. Some analysts say that if the targets are met (a big if, obviously), California would cut more emissions than Japan, France, or the U.K.

- Trends I'm Watching

Update: The Governator is not alone. Over 160 cities within the US have agreed to beat Kyoto-deadlines for 2012, while Portland in Oregon state looks like the front-runner to meet those deadlines. The city also did well in the Sustainability Rankings.

Update 2: States grapple with carbon reduction plan

Indian Infrastructure et al

ICT

While the phone user base in India hits 102 million, the Essar group finally wakes up to the potential in the sector to line up a $1.5 bn investment in the sector. The delay was also in part because they were busy with restructuring their traditional steel and shipping businesses.

Indian IT Minister Dayanidhi Maran has almost prevailed upon Intel chairman Craig Barrett to invest $400 mn in building an advanced test manufaturing center in India. Chennai, Bangalore and Noida are said to the front-runners for the facility.

Japanese electronics giant NEC has set up a joint venture with HCL Technologies to develop high-end wireless technologies. Infosys and Alstom got into a similar deal too. HCL meanwhile also hopes its JV will help it make inroads into the $1 trillion Japanese IT market to find outsourcing opportunities. Maybe this would help.

Growing in the Skies

Indian airlines are getting more access to the world's airports with air routes to Belgium and Holland liberalized and opened up to private airlines. More airlines are firming up plans to share the pie though with GoAir firming up start-up plans.

While Airbus and Boeing are looking to sell heavier aircraft to India, IndUS Aviation plans to make India a light aircraft component manufacturing and export hub. IndUS recently launched, "India's first ever aircraft showroom" in Bangalore.

Reliance and Orissa

Reliance Energy Ltd wants to build a 12 GW coal-based thermal power plant in Orissa. With the right disclaimers in place, it would be the largest plant of its kind in the world. The Orissa government apparently, is not enthused. The deal is that all the coal-mining that Reliance will require, will harm the environment. The government in return wants a slew of monetary compensations, which could render the project uncompetitive. Given the gaps in their respective abilities to implement projects, it would make more sense for the government to get some sort of commitments from Reliance to clean up the environment they damage. Knowing them Reliance will likely turn that into another business opportunity.

Orissa Otherwise

The deal with Posco on the other hand is almost clinched, while Australian mining giant BHP Billiton has started talks on its proposed $1 bn investment on bauxite mining.

Steel Behemoth
The government is planning to merge all PSU steel units into SAIL to create a single 18.5 million tonne entity. Synergies would save marketting expenses. Anything would help when the Chinese challenge rises.

Overseas Expansion

The Munjals of Hero Honda are expanding. They could take stake in Honda subsidiaries in Africa and Latin America to help turn them around.

A National Plan for Energy Efficiency

Addressing an international conference in new Delhi, Petroleum Minister Mani Shankar Aiyar recently "pledged to formulate a national response plan for reducing the unsustainably high energy intensity levels in India". Among other points he suggested taking energy-efficiency to the villages and househol manufacturing units in the country.
1. The Public Private Panchayat Partnership (PPPP) would be used as a platform
2. 1 million women representatives of panchayats to make energy conservation a mass movement
3. The Institute of Engineers would provide basic petty engineering skills to the end users.

When compared to Japan, India needs 4.5 times more energy per unit of GDP. We even need 2.5 times more than the lavish US. Of course there is a good reason for this. As Aiyar said at the conference, energy-efficient technology, though necessary, is expensive and not easily available. Here is his solution:

He also reflected upon the planet protection fund advocated by former prime minister Rajiv Gandhi.

Under this programme, member countries would contribute the same percentage of their GDP towards creating eco-friendly technology which could then be retrieved free of cost by all member countries.

The books we read...

Here is a rare personal-ish post on The Indic View. Personally I would like to see it as the exception that proves the rule!

The Nanopolitan Abi book-tagged me, and the above disclaimer notwithstanding I am glad to respond!

Total number of books I own: Though I read a lot, it is mostly magazines and newspapers - both online and paper versions. Still I do have some 100 books, and it is a mixed collection. Technical books related to my field of work, technical books not related to my field of work, books on the financial markets, novels and general non-fiction.

Last book I bought: Thomas Friedman's The Lexus and the Olive Tree.

Last book I read: The third book in Asimov's Foundation series - Second Foundation. Yes this is the third book, because Prelude to Foundation was added later, and I think that was Asimov's first bestseller too. Anyway, the Foundation was Asimov's self-professed Roman Empire on a galactic scale (he was a history fan too).

Books that mean a lot to me: I will take that to mean books that stand out.

First there is City of Joy. Dominique Lapierre takes you through the filth and destitution of Calcutta, touching upon every gory and gruesome detail, and yet even as feel yourself all covered with slime and dirt, argues with irrefutable logic as to why Calcutta is still the City of Joy.

Any of Asimov's collection of essays on science. He had this amazing gift of making the most complicated and boring of scientific concepts sound so logical and simple. Well that was in large part because he would approach it from the beginning, mentioning all the tiny achievements that went into getting to the monumental achievement in the manner of a historian telling a story.

Who Moved My Cheese - that's an easy one!

Rogue Trader, by Nick Leeson. A hair raising account of how one man, Nick Leeson himself, brought down the Barings Bank, which was almost a British icon at one time. Nick makes some very hard-hitting points, which are arrived at through some hard experiences in life.

Tag some bloggers: While I am not critical of this book-tagging effort, I do not as a rule participate in chain-mailing or chain-posting. Still, any and all my readers are welcome to consider themselves tagged!

Reliance's Power Play

It has licences to sell power in Delhi, Bombay and a few other cities. It is the second largest player in the power sector in India, and distributes almost 6000 MW of power to consumers in several cities. However it only has a generating capacity of around 900 MW. Now Reliance Energy intends to change that.

Two realizations are behind this: Firstly the importance of a strong generation capacity to become a strong distribution player. Secondly, India with an installed power capacity of just over 100,000 MW, needs its capacity to multiply over the next few years and decades. And who is the big daddy of all big investments in the private sector in India? Thats right, the Ambanis of Reliance.

The company is building the largest gas-based plant in the world in Uttar Pradesh, at an estimated cost of Rs 11,000 crores, to produce 3,740 MW of power using gas from Reliance's KG Basin find.

A giant 12,000 MW coal-based plant is being planned in Orissa, at a cost of Rs 48,000 crores. Still at a conceptual stages, the plant will need 10% of the coal reserves in the region.

Still in the feasibility analysis stage is a 4000 MW gas-based project in power-starving Maharashtra. Not sure if this is part of the 12,000 MW worth of projects the state government recently sanctioned (and ran afoul of the center). But Maharashtra looks set for a power surplus situation in another few years if all the projects take off. Good.

Finally in high-hydro-potential Himachal Pradesh, Reliance is in a joint venture to set up a hydropower unit for Rs 750 crores.

Other major Indian corporates are setting up captive wind power plants, but given its background, Reliance remains unlikely to do so soon.

Renewables' Bull Run

Call me hung up on Shell's recent belittling of renewables prospects, but I will use this excuse to again harp on the great potential that solar, wind and wave power represent.

TreeHugger points to a Business 2.0 article on the commercial prospects of investing in clean energy technology companies. There is the WilderHill Clean Energy Index, "which incorporates fuel-cell, solar, wind, and conservation technology stocks". Some technology picks are mentioned there, and it looks like fortunes are there for the making. Interestingly Evergreen Solar, a pure-play photovoltaic solar panels maker, has seen its share price double in the last one year. The only Indian angle comes via Vestas, the Danish giant that also has a joint venture in India.

Talking for Indian investors, there are almost no options, except for NEPC which is into wind power. The IPO was floated in the 90's when wind power was a sun-rise industry in India and had seen a stock market bubble grow and burst then. But the biggest player in the wind power production industry in India is Suzlon, which is not publicly traded. On the solar power side, there are no big power producers, just equipment makers and the biggest there is Tata-BP Solar, which is again not publicly traded. If hydro-electricity is considered as renewable (though not clean and green) energy we do have Jaiprakash Hydro-Power Limited, which went in for an IPO recently.

On the Treehugger link, please do check out the first comment. It is pretty informative for someone interested in trends in the solar power industry.

Green Fuel Station and a Chinese Reva

Via GCC:

How much greener can you get? A bio-diesel fuel station that uses solar power to run! Having said that it must be mentioned that green still comes with a hefty price premium.This pump in California sells a 100% bio-diesel blend called B100 (contains no diesel, only the biofuel), at $3.71 per gallon. That makes it much more expensive than conventional diesel in California which starts from $2.30 per gallon.

And here is China's answer to the Reva. Though the specs read favorably over the regular Reva they are slightly inferior to the Reva NXG, which Reva has not yet decided to launch in India. The Dilip Chabria designed NXG is positively a looker in comparison though.

India Petroleum Update

New Updates
Cairn Energy again finds oil near its Mangala oil field. This is its 12th major find since 1998 in Rajasthan. Though a relatively smaller find (even by Indian standards) at 35 to 70 million barrels, it just adds up.

Petroleum Minister Mani Shankar Aiyar is likely to go to Azerbaijan this week to attend a conference and to explore the possibilities of some oil deals.

Indian Oil Corporation meanwhile took Indian oil diplomacy to Turkey by bidding for a 50% stake in Turkey's biggest refiner.

Ongoing Update I - Oil Price Hike

The oil price hike debate continues with the key players simply repeating themselves over and over again. The Left comes up with alternatives to the hike (refiners to take some burden and the government to take the rest via tax cuts), Laloo suggests decreasing the cost of diesel and Cabinet decides to mull over the issue again. The Communists are planning a big protest, while oil and gas companies are complaining not just the delay in hikes, but also against present pricing mechanisms.

Ongoing Update II - NELP-V

Despite the stiff competition that has come up for blocks under the fifth round of the New Exploration Licensing Policy, it looks like Reliance and ONGC could all the six gas-rich but deep-sea blocks in the KG basin equally between them. Moreover despite all the hoopla over having them apply, it looks like foreigh giants like British Petroleum, British Gas, Petrobras and Petronas are likely to end up with no wins at all in this round, while ONGC alone could win 10 of the 20 oil blocks at stake.

Ongoing Update III - Pipelines

Petroleum Minister Mani Shakar Aiyar goes to Pakistan today to push for pipelines from Iran and Central Asia, and to get Pakistan to buy diesel worth Rs 3000 crore annually from India, besides letting India invest in Paki oil companies. Aiyar will go to Iran next month to sign an LNG import deal. Aiyar also announced a revival in interest in the Oman pipeline.

Bangladesh meanwhile continues to ponder over the proposed Myanmar-India gas pipeline.

Renewable Energy - 25 years down the line

Here was a rude wake up call for all those who would like to believe that a future sans fossil fuels is just round the corner.

Coming on the back of the recent news that BP was going green and profitable, Exxon comes along with these two points:
1. Renewables like solar and wind are profitable in the US (and implicitly elsewhere too) only with government subsidies
2. 25 years from now, renewables will only have a one per cent share in energy usage world-wide, up from the 0.5 per cent today. Oil and gas will still meet 60% of the requirement.

Exxon Mobil is the largest publicly traded energy (and second overall) company in the world and the business acumen of such a group cannot be dismissed lightly. So what does they mean this time?

Maybe renewables enthusiasts tend to get carried away by symbolic gestures. Australia for example is going to build the largest solar plant in the world to generate 200 MW of power. That is still 0.014 per cent of all the electricity generated in the world in 2004. When it will be ready in 2009 it will represent an even smaller percentage. We would need a hundred of these technological marvels to make one percent. But solar power is not the leading light of the renewables movement. Wind power is, and the largest planned wind farm is in Scotland which when ready would produce 10,000 MW of power. At 0.7% that is close to one percent of all the electricity generated in 2004. So where do renewables stand in the larger scheme of things?

Europe is going in for renewables in a big way. Much before 2030, at least 20% of all electricity in Europe will come from renewable sources - Iceland is already close to 100% and Scotland could be at 40% then. By then all diesel in India will be B-20 (20% bio-diesel). Brazil will at least match that and might even replace petrol altogether with ethanol. The US should also see something similar, because despite the lack of a Europe-style push a lot of the big innovations and adoptions are coming in from there. China could match Indian bio-diesel commitments, and Japan should match Europe overall. So we are looking at the US, Europe and Japan getting between 10-25% of their electricity from renewables. We are looking at these countries along with India, China and Brazil using renewables to meet at least 10% of their automobile fuel requirements. And these are pretty conservative estimates. If we get the right technological breaks over the next few years, then by 2030 we would be treating oil like any other raw material - as a material rather than a fuel.

Exxon might be adopting a typical big company approach here. Wait for the crucial breakthroughs that will make renewables really competitive and then move in with force. Still I am not optimistic about this approach. I believe renewables are the future that will become the present in a decade or two.

Big Solar Company Profitable

It has been a pioneer of solar photovoltaic cells for the commercial market in India, via its joint venture with the Tata Group called Tata BP Solar.

Globally, like it has become fashionable of late, BP Global, is distancing itself from its past. It's earlier name was British Petroleum, but of late it says BP stands for "Beyond Petroleum". Whatever the merit of that statement, BP Solar, their solar division, is among the largest solar companies in the world. In 2004, the solar industry grew 40% overall, and perhaps riding the boom, BP Solar was finally profitable. This is great news because if BP can keep this up, it points to an impending flood of new companies into the field, which will further drive the prices down.

We already have these new generation technology companies knocking though.

World's First Wave Farm

They said it would come up in China. But that did not make sense as technology leadership in the field was in the UK and in Australia. So fact proved to be otherwise.

They did it in Portugal. The world finally has a commercial electric power plant that generates power solely from ocean waves. The UK connection comes in the form of the company that provided the technology to set up the plant.

The waters in the oceans dont move as much as the winds, but energy density is much higher in the water, because it is much denser than air. Thus the mechanical power of the waves holds much potential for renewable energy researchers. If this plant is successful it could trigger off a series of other such plants in the region. Currently though wave power costs about 3 times as much as wind power.

However, one important barrier for renewable energy remains technology maturity. This is of course a problem in any area where a lot of technological developments are taking place fast. Setting up a renewable energy plant is like buying a PC - you already know it would not be technologically state-of-the-art, if not obsolete, long before it is up and running.

Renewable Energy in India - the Ministry's Scorecard

Via WorldChanging: Renewable Energy Access is carrying a roundup of renewable energy efforts in India based an update by the Ministry of Non-Conventional Energy Sources.

Not too many surprises there but there are some useful figures for reference.

India has become the fourth largest wind power producing nation in the world with a capacity of 3500 MW, over 1600 MW of which has come in just the last two years. Other nations though are fast catching up. In the UK just one plant is expected to have a capacity of 10 GW.

Last year apart from 1000 MW added via wind power, 200 MW were added through small hydro and biomass power projects. Further 10% of the new power addition in the the country is to come from renewable energy sources.

Other highlights:

• 100,000 biogas plants were installed in 2004-05. In the same period biomass power projects with a total capacity of 140 MW were added.
  
• A 1 MW power plant from cow dung and a 3 MW poer plant from palm oil industry waste were commissioned as pilot projects to pave the way for many more.
  
• "A District Advisory Committee (DAC) on Renewable Energy headed by the District Collector is being constituted in every district to oversee the implementation of renewable energy programs in the district, integrate these with other rural development programs and address barriers to the accelerated switch over to renewable energy."
  
• There is a mention of the Village Energy Security Program for providing electricity to rural villages via biomass and other renewable energy sources.
  

Rainwater Harvesting

Treehugger reports on a rainwater harvesting workshop held in Toronto. Some important points were made here.

We assume that rain water harvesting is needed only in seriously water starved communities and areas. Those theories stand bunked. Here is why:
1. Even if a town is sitting right beside a giant fresh water lake, pumping the water out of the lake and into people's homes involves huge expenditure in the form of investment in infrastructure and the ongoing expenses in terms of personnel and power to keep that infrastructure running.
2. Rain water harvesting reduces the load on public drains - hence no water clogged roads and reduction in infrastructure and maintenance costs for urban infrastructure.
3. Rain water is usually safer to drink than the mains water supply in many cities. Even if you dont drink the rain water you can still use it for 95% of the needs - only 5% of the water is for drinking/cooking.

There is a difference between the kind of rain water harvesting (RWH) that is practised in the West and what it implies in India. In the West (it is actually most popular in Australia), you directly take the water falling on your roof and collect it in a giant tank - like in this example - to be reused whenever required. Works for regions where it rains little but through out the year. However, since most of the rainfall is concentrated in just 3-4 months in most regions in India, rain water harvesting for us usually refers to using the rain water to charge the water table or ground water level. So the water level in our wells, borewells, lakes and ponds rises, and we still have the other benefits of reducing strain on public infrastructure. And maybe some Karma too, who knows?

New World Record for Mileage at almost 4,000 kmpl

via GCC: 3,836 kmpl - that was the mileage (or more correctly the petrol equivalent energy) returned by a prototype at the Shell Eco-marathon in France last weekend. Predictably that was a new world record. If automobiles the world over had one tenth of that mileage, oil prices would easily fall to half.

200 cars participated in this week's eco-marathon, only six of which were fuel-cell cars. Yet one of those 6 topped the overall rankings. The best for a petrol car was 2560 kmpl, for diesel 1807 kmpl and for LPG it was 1804. The victory for the hydrogen car is causing more participants to consider a switch to hydrogen next year.

Hydrogen Superhighway Closer to Reality

Via GCC: Small car major ZAP (Zero Air Pollution), with a technology partner Apollo, has managed a technological (or engineering?) breakthrough that will allow fuel cell cars to carry ammonia instead of liquid or gasseous hydrogen as fuel.

To start a little from the beginning, fuel cell cars use hydrogen as fuel. Hydrogen though a very clean fuel (it's combustion produces water) is very volatile. So it has to be properly insulated because it can react with almost every constituent of air. Thus the technology to build an appropriate fuel storage capacity has been a key challenge for fuel cell cars. Strong (and expensive) tanks to store liquid hydrogen, and nanotechnology-based porous material to store hydrogen were some of the options that have been the most promising thus far. The new technology altogether bypasses the challenge.

The new car will store hydrogen in the form of ammonia(NH₃), which will be passed through an onboard "ammonia cracker" that will pull out hydrogen from it and pass it to the Alkaline Fuel Cell (AFC). The technology offers several advantages over conventional PEM fuel cell vehicles.

Firstly savings in costs and logistics resulting from the elimination of hydrogen storage. Ammonia can be produced (to start with at least) at the same refineries where fossil fuels are produced, and can be transported in pretty much the same manner. Plus the actual vehicle becomes lighter and cheaper.

Secondly, AFC's are very efficient and not requiring expensive precious metal catalysts are cheaper than PEM's. They also operate well at room temperature and have a good cold start capability. ZAP-Apollo have solved a major technological problem related to CO₂ poisoning that has prevented popularity of AFC cars thus far.

This could be a real breakthrough in achieving California governor Arnold Schwarzenegger's purported target of a Hydrogen Superhigway in California by 2010.

Bio-diesel Commitments

Green Car Congress points to a news report that the Haryana government has decided, on the basis of a pilot project on 20 buses, that all buses at the Gurgaon bus depot will run on a 5% bio-diesel mix - starting this June. This makes it the first bus depot in the country to issue this directive. Apart from cutting down on pollution and saving foreign exchange, this initiative also gives added impetus to agricultural employment in the state. Haryana farmers apparently are taking to growing Jatropha in a big way.

Though initially the mix is going to be just 5% bio-diesel and 95% conventional diesel, this could be increased to 20% in a few months. Though the report claims other concerns, the core concern should be the cost of the fuel.

Some years back the Vajpayee government had called for global tenders to produce and sell bio-diesel in India in a big way. Only two tenders came up and the lowest price quoted was Rs 100 per litre of bio-diesel. Currently the railways buy or produce bio-diesel and the cost works out to be in the band of Rs 50 to Rs 78 per litre. While this is substantial improvement over the price quoted above we still have a pretty long way to go before biodiesel can compete with petro-diesel on cost.

The biggest avanue for cost-cutting would be the Jatropha seeds, which currently sell at Rs 30 a kg (you need at least 3 kg to make one litre). At this rate the profit per acre is about Rs 80,000 which is much higher than what is got with horticultural products that need much higher maintenance and investment. Considering the low investment and costs, it is likely that that the costs could fall by as much as 80% once Jatropha growing becomes really popular.

Wind Power Map of the World

Via Alt-e and WorldChanging:
For the first time in a NASA-funded study, researchers from Stanford have produced a map that identifies locations around the world where the wind is strong enough to generate electricity. The best place apparently is the North Sea region in Northern Europe for the strong winds. The southern tip of South America and the Australian island of Tasmania also recorded significant and sustained strong winds at turbine blade height. I wonder where India figures, but with a total estimated capacity of just 40 GW (Indian Govt figures) it cannot be very close to the top.

While world-wide electricity usage was less than 1.8 terawatts, the potential for generating electricity from winds was estimated to be 72 terawatts. One terrawatt is equal to a trillion watts and it would take hundreds of nuclear reactors to produce that much power. The Dabhol thermal power plant at full capacity would produce about 2 gigawatts, so you would need 500 such projects.

There are problems with wind energy too, but a lot of those problems are to do with placement of turbines. The study suggests that offshore installations are likely to be more efficient than more inland ones. The biggest wind turbines in the world generate about 5MW of power, and you would need less than 200,000 of these to serve electricity to the whole world in 2004.

India Petroleum Update

Refineries for Rajasthan

Rajasthan, home to some of the biggest onshore oil fields in the country, wants to have more refineries in the state, instead of sending the crude to other states for refining. It is planning a bouquet of incentives on this. Cairn Energy meanwhile plans to invest $1.3 bn in its Rajasthan discoveries.

Woe for ONGC...

It was a bad week for ONGC. Following a Petroleum Ministry directive to appoint additional executive directors to the board, ONGC is risking delisting by SEBI. ONGC is the biggest company in India in terms of market capitalization. The easy way out would be to appoint more independent or non-executive directors on the board to maintain the required proportion. Other policies remain violated though.

Meanwhile ONGC will continue to lose Rs 3000 crore every year in underpricing of natural gas sales to fertilizer and power companies - simply because the ministry concerned does not want to raise power tarriffs.

Student protestors in Assam shut down ONGC's operations in the state for a "100 hours bandh". Operations were resumed but only after the 100 hours were up. Fears of another flare-up remain. ONGC is already said to be overstaffed in Assam.

... And some cheer

After First Calgary Petroleum, it is another Canadian company this week. After successfully reaching the second round of bidding, ONGC arm OVL, "has bid $1.4 billion for buying out Canadian firm Encana's stake in a cluster of oilfields in Ecuador". If successful this would be OVL's second largest overseas investment after Sakhalin-I. Encana's Amazon assets have a combined output of 66,891 barrels a day.

Oil Hike Update

The Left wants to target the very high refining margins of refineries, particularly stand-alone refineries, who earn as much as $12 per barrel (consumers of petrol and diesel pay around $100). Other cost saving measures suggested are cutting down on advertising and public displays. In lieu of these suggestions, the Left thinks the price hike (per litre) should be in the range of Rs 1.50 to 2.00, when the oil companies are asking for Rs 4.84/4.52 and the ministry is mulling Rs 2.6/3.75 on petrol/diesel. A final formula might involve the Govt, the oil cos and the consumer sharing the burden.

India International

In volume terms, India's exports of petroleum products went up 25% while imports went up just 5.4%. The devil in the details of course is the stupendous increase in cost of imports, while there was no proportional increase in price of exports. Oil minister Aiyar is pretty upbeatthough on prospects of India becoming a major petro products exporter. "India's crude oil import bill in 2004/05 was 1,170 billion rupees, while earnings from exports amounted to 284 billion rupees". This number does not take into account the increased import of natural gas that has also been responsible for freeing refinery capacity for exports.

The Saudis brought India down to earth by refusing both Indian bids for a stake in Saudi Aramco's Yanbu refinery. Aramco said they were looking at "western partners". India had offered a barter deal via Aramco taking a stake in an Indian PSU refinery. The refusal does not have any major significance except when seen in the context of the recent bonhomie.

Pipeline Politics Update

Pakistan will decide by Dec 31 on its pipeline options. It will choose between Qatar, Iran and Turkmenistan, and wants at least two pipelines. Further Pakistan has, "offered India use of those pipelines to fulfil its gas needs". It would be interesting to observe whether the Pakistani market is deemed big enough to absorb the costs of two rather expensive pipelines. It is also widely believed that India has decent leverage with the Baloch rebels who will then not be restrained if the pipeline does not go all the way to India. Even if the pipeline comes all the way to India apprehensions on commercial viability remain.

Hindi-Chini Oil-Bhai

India's petroleum ministry is finalizing a strategy paper on cooperation between India and China in international oil exploration. Despite the recent bonhomie, here is an article that reiterates why this nature of cooperation is highly unlikely.

The Five Millionth Patent

The US Dept of Commerce selected it to become the Landmark Patent No 5,000,000. That is indeed some honor, and it seems not without good reason.

The patent was granted to Lonnie Ingram, a microbiology professor at the University of Florida, for being able to use E-Coli bacteria to convert biomass into ethanol. The highlight is that his process can use biomass residue like "sugarcane residues, rice hulls, forestry and wood wastes and other organic materials".

We have already seen how TA Sugars in Tamil Nadu are already using bagasse (sugarcane residue) to make electricity. And this Rajasthani dude is using "agricultural wastes" to produce electricity. The E-Coli process is better because you are converting the biomass into ethanol with a 90% plus efficiency. Plus ethanol can directly replace fossil fuels in petrol automobiles.

The greatest advantage is that it brings to the table a whole new world of renewables as raw material for converting into ethanol. And the technology is rather simple too - which means it can be replicated quickly and rather cheaply. So what are the immediate outcomes of this technological breakthrough?

For a start, we are likely to see a doubling of the ethanol production in the US. In the longer term, this technology has the potential to replace half of all petroleum imports into the US using renewable agricultural and forest waste. In India a lot of these biomass residues are not really "wasted" but conversion-to-ethanol could turn out to a more lucrative market for straw, rice husk and dry leaves. This could give fresh impetus to rural economies. On their part enterprising sugar mills like TA Sugars could start contributing to the electricity grid in a bigger way. It also depends on how the technology is made available.

The downside is it could lead to large-scale tree-cutting, thus depleting the same environment green technologies are trying to save. After all how do you define "waste" wood?

Update: Here's another wood-to-ethanol technology - this time from the State University of New York researchers.

Indexing The Indic View

India Petroleum Updates

Saturday, May 07, 2005
India Petroleum Update
NELP-V attracting interest, Reviving oil wells in Assam, ONGC announces three discoveries
Pipeline Update: Indo-Iran pipe by 2010, India offers $2.50 per mBtu, China interested in the pipe, Oman pipe still on?
Elsewhere: ONGC's private security in NE, progress on coal gassification project, BPCL moves on Bina refinery, HPCL divestment officially off.

Sunday, May 01, 2005
India Petroleum Update
Foreign Oil Equity - Interesting Developments: Freeing PSU investing abroad. Footprint now in 4 countries.
Gas On The Domestic Front - Tapti gas field, RIL's KG Basin, Iran LNG for Petronet.
Downstream On The Domestic Front - negative growth in petro products, Cairn crude for IOC, JV with ONGC, ONGC's troubles in NE
India's Oil Barons - India's Top Ten Oil Men
Dubya-speak - offers clean tech to India

Saturday, April 23, 2005
India Petroleum Update
The Venezuelan Angle: ONGC talking to PDVSA
Domestic Sources: Cairn upgrades reserves estimates, ONGC new tech in Assam, India's oil output dips
The Pipeline Saga...: Bangladesh pipeline, Uzbek link to TAP, Energy Charter Treaty
The Hinduja Connection
The Black Gold's Curse

Saturday, April 16, 2005
India Petroleum Update
Videocon - New Kid On The Block
The Qatari Angle
Burmese Gas
Elsewhere...

Saturday, April 09, 2005
India Petroleum Update
Pipeline Politics - The Eastern Front
The Saudi Front
The Domestic Front - Oil, Politics and Business: price hike demand, OIL gives up Louisiana field, haggling over IPO proceeds, IOC tops ATS ranking, freed from SCI, glut in Jamnagar

Saturday, April 02, 2005
India Petroleum Update
Re-visiting the North-East
The Saudi Angle
Pipeline Politics
The View From Here

Friday, March 25, 2005
India Petroleum Update
Action on the refineries front: Mid-East interest in setting up refineries in India
Foreign Oil Equity Quest: IOC-OIL formally acquire field in Libya
Domestic Exploration: positive signs of gas in the Sunderbans
Retail: ONGC and Reliance

Friday, March 18, 2005
India Petroleum Update

Friday, March 11, 2005
India Petroleum Update
The Russian frontier
The happenning ONGC! - discoveries KG Basin, Egypt, Nigeria. Stake in Venezuela, to buy VLCC
Reliance on the prowl too - International Refiner of the year, stake-hunting in Africa, Mid-East, Lat-Am.
Restructuring options - Synergy for Energy
NELP-V lures Talisman and Shell
Aiyar this week - EOU Refineries
Moot Point: Are Indian reserves hyped up?

Thursday, March 03, 2005
India Petroleum Update
The oil equity quest: Qatar, Iran, Burma, Russia, Bangladesh, Angola, Chad, Nigeria
Aiyar's Third Front: Longer-term contracts
Domestic compulsions on strategy: Under-pricing costs $15 bn

Tuesday, February 22, 2005
India Petroleum Update
Kazakhstan (Kashagan), Russia (Yukos), ONGC in Sunderbans

Tuesday, February 15, 2005
India Petroleum Update
GAIL - DPC, China, Burma, Infosys
Asian Gas Grid
Yugansk stake for India not China
Euro-III fuel, Chemtech 2005

Alternate Energy

Saturday, April 09, 2005
The Kyoto Windfall

Wednesday, May 04, 2005
World's First OTEC facility - in India!
Brief Introduction: what is OTEC?
The big story: OTEC plant commissioned in India

Tuesday, May 03, 2005
Some Clean Power Trends
Statistics show that wind power is getting more economical.
Microbial Fuel Cells can convert waste water to hydrogen or electricity.

Thursday, April 28, 2005
World's first Solar-City - in India!

Wednesday, April 27, 2005
More on the Kyoto Windfall
Carbon Development Mechanism and resultant benefits for industry

Tuesday, April 19, 2005
Reva - set for big time

Monday, April 11, 2005
"Garbage Power" Initiatives
Biomass initiatives - a mechanic in Rajasthan and a plant in Delhi

Friday, April 08, 2005
Windy Trends For Power In India

Friday, March 11, 2005
Alternate Energy is happenning in India...
Wind Power
Bio-diesel

Thursday, February 24, 2005
GAIL guns for gas from coal

Wednesday, February 02, 2005
Biodiesel - disagreement between champions

The Rest

Thursday, April 07, 2005
New trends in robotic warfare

Wednesday, March 30, 2005
The Simputer making progress

Wednesday, March 30, 2005
India's tallest building in the World

Thursday, March 24, 2005
India's indigenous aircraft carrier

Wednesday, March 16, 2005
Towards a handheld future

Wednesday, March 16, 2005
Scorpio going places

Monday, March 07, 2005
Israel builds "Weapon Next" in robotic warfare
Robotic eye in the sky

Monday, March 07, 2005
An alternate route to Central Asia

Thursday, March 03, 2005
ISRO's biggest overseas deal
350 kg Italian satellite called Ajile, to be launched early next year.

Wednesday, March 02, 2005
Developing new trading avenues: Port access to NE via Burma

Friday, February 25, 2005
A Big Boost to Construction

Thursday, February 17, 2005
The Akash SAM comes of age?

Wednesday, February 16, 2005
Europe's most powerful rocket launched successfully

Friday, February 11, 2005
Pipeline Progress

Wednesday, February 09, 2005
Water body revival plan

Sunday, February 06, 2005
Research into 'Sumo' rats at Hyderabad

Friday, February 04, 2005
More nano transistors per chip

Thursday, February 03, 2005
A tale of two helicopters

Tuesday, February 01, 2005
Indian oil firms successful in Libya

Monday, January 31, 2005
Iraq polls a success!!!

Monday, January 31, 2005
Pipeline Politics Update

Friday, January 28, 2005
Marina takes Tata past Hyundai

Thursday, January 27, 2005
Recording India's biodiversity

Thursday, January 27, 2005
Right to vote negative

Monday, January 24, 2005
US to roll out war robots in Iraq

Friday, January 21, 2005
Soyuz to be launched from Kourou

Tuesday, January 18, 2005
India, Japan collaborating on the telecom stage

Monday, January 17, 2005
A movement to revolutionize PCO's?

Friday, January 14, 2005
Internet for the rural masses

Thursday, January 13, 2005
Iran cosying up to India a little more

Wednesday, January 12, 2005
Nanotechnology driven efficient Solar Cells

Wednesday, January 12, 2005
Burmese Gas pipeline to India

Sunday, January 09, 2005
India's bid for Yukos asset

Friday, January 07, 2005
Will the Reliance magic work on Arabia?

Friday, January 07, 2005
The Simputer's latest avatar - SATHI

Friday, January 07, 2005
Flyover in 36 hours - in India!

Thursday, January 06, 2005
Christmas Bonanza for Infrastructure in Bangalore

Thursday, January 06, 2005
India emerging a power in the Clinical Trial space

Wednesday, January 05, 2005
Chandrayaan to have "landing" component too!

Wednesday, January 05, 2005
The Broadband Village

Wednesday, January 05, 2005
Introduction

Eco-friendly transport system for Delhi

New Delhi is preparing for the Commonwealth Games in 2010. With transport infrastructure creaking despite the metro, new alternatives are being sought. Electric buses are one of the transport options being thought of.

---

In a move that found its way to posts on Green Car Congress and Worldchanging (and lots of discussion groups), central minister for S&T announced that Bangalore based Reva was being considered for providing 16-seater battery-cum-solar powered transport buses for a transport solution to ease congestion in the capital city.

The proposed size of the order for Reva is around Rs 260 million, in addition to which, "the Department of Science and Technology (DST) has offered to fund further research for developing a 20 and 32-seater bus prototype, as also three-wheelers, through the Technology Development Board."

The good news is, it appears that Reva might not be the only contender for an electric future for mass transit in Delhi. BHEL has been making electric buses and vans (Electravan) for years, though a comparison with the Reva product is not available.

IIT-Delhi however appears to have come up with an interesting solution: convert the 9000 discarded diesel buses to diesel-electric hybrids. Working on a Rs 56 million grant from the petroleum ministry, the battery operated bus can carry 150 people, has a top speed of 65 kmph and can cover 160 km at a go, and does not generate vibration, noise, heat or emissions (as long as it is run on electricity). The battery has a life of 25 years, and is charged using an on-board diesel motor (thats why they call it a hybrid).

Now for the finances. A new bus using this technology would cost Rs 2.1 million. A diesel bus costs just Rs 1.4 million, whereas a CNG bus would cost at least Rs 1.6 million. Not sure about the fuel charges, but if you use the grid to charge the batteries, the charges will be pretty low. The Reva bus runs at Rs 1.20 per km, though it is just a 16 seater. What does it cost? Rs 2.6 million (more than the IIT-D bus that can carry many, many more people).

Of course there is a difference between technology demostration and commercialization, but Delhi could do well with a combination of solutions to start with, and decide on the actual path once they stabilize.

India Bio-diesel Update

There has been a lot of action on the bio-diesel front in India of late. Let me try and re-cap some of it:

First a couple of links from the Green Car Congress, which reports that the Chief Minister of Chhattisgarh, Raman Singh, has become the first head of an Indian state to start using bio-diesel to power his official car, a Tata Safari. In three months it is hoped that all government vehicles will run on bio-deisel and in ten years the state will be self-reliant in bio-diesel production. By then the state would also supply "bio-fuel to other states at Rs 20 a litre". It is not clear what percent of the biodiesel is diesel though - it could be anywhere from 0 to 98%.

The next post states that India is planning a Comprehensive National Biodiesel Policy. The aim is to start using a 20 per cent biodiesel blend (80% diesel) all over India which will result in savings of 20,000 crores, Jatropha plantation on 11 million hectares of land, 11 million jobs and 13 million tonnes of alternate fuel produced each year. Bio-diesel processing/extraction costs one third in India as compared to Europe and exports are being looked at in a big way.

Labland Biotechs is a Mysore-based company that is becoming a sort of an export oriented unit for Jatropha oil. It sources high quality tissue culture derived jatropha plants from D1 Oils, a global leader in the field of bio-diesel, and supplies them to the farmers. It will then buy the seeds from the farmers, and produce and sell the oil to D1 Oils. D1 will then refine the oil and sell it to European countries. Labland is also working on actively spreading awareness on jatropha to farmers in the region, as also to train farmers on all aspects to cultivating and maintaining the jatropha plants.

Europe has developed a deep love for jatropha and biodiesel. D1 Oils is one of the leading companies that are trying to fufill that demand. The foundation stone for India's first biodiesel plant was laid one day after the Kyoto Protocol was signed.

Getting back to the national biodiesel mission, the government has noted the lack on action on this front and is thus planning to shift responsibilities. Out of the small amount of Rs 9 crore that was assigned to the project last year, the Rural Development ministry managed to spend just Rs 20 lakhs. Now that the fund allocation has been increased to Rs 45 crores the government is mulling giving the agricultural ministry the charge on the mission.

India Petroleum Update

ONGC looking at very lucrative buy

ONGC (via OVL) is trying to get buy a Canadian company, First Calgary Petroleum. FCP has 49% stake in two blocks in Algeria which have a combined potential of around 13 trillion cubic feet of gas and some 100 million barrels of oil. The oil assets are clearly very attractive, and ONGC has stiff competition in the form of Statoil, Total and Gaz de Franz. The bid has seen some interesting twists and turns thus far. Soon after news that ONGC had bid for FCP, came news that ONGC's bid had been rejected. But it so happenned that all international bids had been rejected, for being below the reserve price. OVL plans to bid more aggressively when re-bidding opens next month. First Calgary however denied the bid rejections. Let the waters settle down...

Domestic Exploration

Meanwhile the number of companies bidding for blocks under NELP-V has reached 30. Justifiably, oil minister Mani Shankar Aiyar is rejoicing.

The Kazakh Angle

Though India did not get any stake in the giant Kashagan or the Kurmangazy oil fields, Kazakhstan is offering India a stake in one of two medium size blocks. India continues to also lobby for some stake in two pipelines to take Kazakh oil to the Mediterranean and China respectively.

Domestic Policy

Here's another reason why I only invest in upstream majors among Indian companies. I am not complaining, because my petrol bill does not bloat with international trends. Still something has to give, and I wonder what that is...

The Economist Ignores Peak Oil

Rajesh Jain at Emergic, has a post pointing to this article from The Economist. The article talks about why oil prices are high and takes a pragmatic view based on economic reason with no mention of peak oil. There are some interesting points being made though:

1. The 16% increase in Chinese demand for oil last year was a temporary phenomenon. It could be a more sedate 4-5% this year.

2. It is not just OPEC that has a stake in keeping oil prices high. The big western oil companies that are investing in non-OPEC regions with tough terrain - they need high oil prices to make a profit.

3. Saudi is rebuilding the oil buffer which could help further cool down oil prices.

4. The joker in the pack could be the financial sector - big investors have invested heavily in oil expecting prices to remain high if not reach much higher. These investments have some of the makings of a bubble. If this bubble collapses we might have cheap oil again.

Finally in the post, Rajesh quotes from another article (which is premium content) on how alternate energy sources are making headway into the automobile world. Mentioned are bio-diesel, natural gas and hydrogen-based fuel cells. GM it seems is betting on fuel cells.