10 things you should know about the Reliance KG-D6 gas deal

Business Standard tried its best to educate readers on this issue. Excerpts:

• The brothers while splitting their father’s empire split the gas reserves too.None of the ministries involved in the process, including the oil ministry which Moily now represents, raised the point that the gas reserves belonged to the country and was not a property of the Ambani family. Even the Prime Minister, ManMohan Singh meekly requested the brothers to settle their differences in the interests of the country.
•  The Supreme Court finally settled the matter by saying that ‘the government owns the gas till it reaches its ultimate consumer and parties must restrict their negotiation within the conditions of the government policy’.
• Former RBI governor C Rangarajan came out with a formula which has been followed nowhere in the world, which has resulted in Reliance (and other players too) getting a price on import parity basis. Surya Sethi, former Principal Adviser, Power and Energy, Government of India does not mince words when he asks the Prime Minister in an open letter  not to burden the nation with Rangarajan Committee’s madness that only benefit a select few. 

Best Available and Safest Technologies for Offshore Oil and Gas Operations: Options for Implementation

Offshore drilling/ exploration technology is a black-box for policy makers in India. Not so in USA. This report gives an overview prepared for US policy makers. The Outer Continental Shelf Lands Act (OCSLA), of US  mandates that the Secretary:
shall require, on all new drilling and production operations and, wherever practicable, on existing operations, the use of the best available and safest technologies which the Secretary determines to be economically feasible, wherever failure of equipment would have a significant effect on safety, health, or the environment, except where the Secretary determines that the incremental benefits are clearly insufficient to justify the incremental costs of utilizing such technologies.

This PDF is available from The National Academies Press at http://www.nap.edu/catalog.php?record_id=18545

The long shadow of Enron on powerless Andhra Pradesh

Rebecca Mark, once one of the most powerful business person in USA probably never visited Andhra Pradesh. She had cast a magic spell on greedy politicians, bureaucrats  and Financial institutes in India and also in many other countries. In the highly inflated Enron plant cost estimates, she made liberal provision to educate Indian people. But we never tried to learn.
Enron exposed in USA went bankrupt in 2001but plant at Ratnagiri was salvaged with public money in India.NTPC and GAIl were made to pump money and everyone knows that plant will never break even even after writing off all bank loans by buying the feed LNG from market. Writing off investment would invite caustic comments by CAG and the only alternative left to the promoter GAIL is to keep the sick plant on notionally alive category is to pump low cost gas from KG fields whether A.P likes it or not. 
All the suppliers to Enron made money by supplying plant and parts that could not be used, Indian FIs wrote off investment, NTPC & GAIL the public sector undertakings had been made to pump public money to keep the lid on. And who would  have imagined dining and wining of sexy Rebecca by Indian politicians would switch off power to million homes in distant place called Andha Pradesh. 

Vermont Will Be First U.S. State to Ban Fracking

"We don't want to be shooting chemicals into our groundwater in pursuit of gas that does not exist," Governor Shumlin said Friday after the House vote.
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Berlin is opposed to plans to use the controversial fracking process to extract natural gas in Germany

Germany has put the brakes on plans to use hydraulic fracturing, commonly known as fracking, to extract natural gas in places where it is difficult to access, such as shale or coal beds. Environment Minister Norbert Röttgen and Economy Minister Philipp Rösler have agreed to oppose the controversial process for the time being, SPIEGEL has learned.

Sources in the German government said that the ministers were "very skeptical" about fracking, which injects chemicals as well as sand and water into the ground to release natural gas. "There are many open questions which we will first have to carefully examine," Rösler told close associates.

With their stance, the two ministers are opposing plans by energy companies to use the fracking process to tap into deposits of natural gas in shale, especially in northern and eastern Germany. In order to access the gas, the shale needs to be fractured using a mixture of hot water, sand and chemical additives, some of which are poisonous. Environmental groups reject the use of the technology, saying that the chemicals used can contaminate drinking water.

Local Protests

Last week, the energy giant ExxonMobil presented a study by the Helmholtz Center for Environmental Research, in which researchers expressed their support for test drilling in the states of Lower Saxony and North Rhine-Westphalia.

Local environmental groups in the affected regions have already got into gear, setting up citizens' initiatives to collect signatures for petitions and organize protests in a bid to block the fracking plans. Activists fear that the chemicals could pollute the local groundwater.

Fracking has been widely used in the US, where production of natural gas has sharply increased in recent years as the use of hydraulic fracturing becomes more widespread. Earlier this month, President Barack Obama's administration unveiled new regulations to improve transparency on the chemicals used during fracking on public land.

Source: speigel

Gujarat State Petroleum Corporation (GSPC) may witness a “marginal” increase in its KG offshore development cost

Gujarat State Petroleum Corporation (GSPC) may witness a “marginal” increase in its KG offshore development cost from the initially estimated $1.7 billion (approximately Rs 8,800 crore at the current exchange value) due to recent amendments in drilling technology to manage the high pressure and temperature of the reservoir.

First gas from KG-OSN-2001/3, the field has been rechristened as “Deen-Dayal,” is expected in 2013. Peak output from the find is estimated to reach 5.7-8.6 million metric standard cubic metre a day (mmscmd).

Though located in shallow water, development of the gas find is considered “challenging” due to twin hurdles of temperature and pressure. The field development plan (FDP) was approved by the Directorate General of Hydrocarbons in November 2009.

According to sources, GSPC has already drilled the “top-hole” section of the four production wells, out of the proposed 15, by using a jack-up rig Deep Sea Driller – I, costing $ 100,000 a day. To drill the final section of the reservoir wall by using a cheaper ($62,000 a day) platform-rig, GSPC has roped in Blade Energy to adopt managed pressure drilling (MPD) technology, which was not part of the original FDP.

Source: Business Line

KG D6 on Wiki

Read http://en.wikipedia.org/wiki/KG-D6_Gas_Scam