Infrastructure and Energy Sector

NSG_Blackcats

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Easier foreign debt for core NBFCs​

NEW DELHI: Non-banking finance companies that fund the infrastructure sector will be able to raise foreign debt more easily as the RBI and the government has decided to allow these entities to access foreign funds from all lending agencies. This will increase the flow of funds to the sector.

These specialised NBFCs were allowed to access foreign debt in January, 2008 from multilateral agencies such as KFW, World Bank, as a part of the stimulus package given to insulate the Indian economy from global financial meltdown.

However, the move hardly solved the problem of these specialised NBFCs as most of the multilateral organisations found it easier to lend directly to infrastructure projects. These NBFCs had petitioned to both the government and RBI, seeking flexibility to raise ECB from multiple entities to meet their on-lending requirement.

“These companies will now be able to raise overseas debt from multiple agencies,” a government official said. The move will benefit public sector NBFCs such as Power Finance Corporation, Rural Electrification Corporation and private sector ones including Srei Infrastructure Finance, L&T Finance. However, these firms would be able to raise foreign debt only after securing a prior approval from the central bank.

However, they would be subject to prudential guidelines of the central bank. “This would make it easier and faster for these NBFCs to raise funds and thereby help improve the flow of funds to the infrastructure sector as a whole,” said Sanjay Hegde, executive director, PwC.

RBI had last month created a special category of infrastructure NBFCs, in a move aimed at encouraging flow of funds to the sector that would require about $ 500 billion over eleventh five year plan period.(2007-2012).

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RPK

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Tamil Nadu emerges top Indian state in wind energy production

Tamil Nadu has emerged the leading state in wind power development in the country with a, installed generating capacity of 4,563 MW as of October 2009, minister for new and renewable energy Farooq Abdullah informed the Rajya Sabha in a written reply today.

He said the government has been promoting commercial grid connected wind power projects through private sector investment in wind potential states, including Tamil Nadu by providing financial incentives, loan from Indian Renewable Energy Development Agency (IREDA) and other financial institutions.

The government, through the Centre for Wind Energy Technology (C-WET), Chennai, is also providing technical support, including detailed wind resource assessment, to identify further potential sites, the minister said.

The minister said the government has also embarked upon an ambitious Jawaharlal Nehru National Solar Mission - `Solar India,' which aims at producing 20,000 MW of solar power by the year 2022.

"I am happy to announce that the government has approved a new policy on development of solar energy in the country by launching of the Jawaharlal Nehru National Solar Mission. This is a historic and transformational initiative of the UPA government and I am proud to have the privilege of being assigned the task of overseeing its implementation. The Solar Mission is very much in line with the vision of modern India of Pandit Nehru, which has made India today, a leading nuclear and space power," he said.

This Mission is one of the eight key national missions that together form India's National Action Plan on Climate Change that aims at contributing to India's long-term energy security while ensuring ecological security.

"We are living in a world of rapidly depleting fossil fuel resources and access to conventional energy resources such as oil, gas and coal is becoming increasingly constrained. The rapid development and deployment of renewable energy is imperative in this context and in view of high solar radiation over the country solar energy provides a long term sustainable solution," he said.

The solar mission would be implemented in three stages leading up to an installed capacity of 20,000 MW by the end of the 13th Five Year Plan in 2022.

It is envisaged that as a result of rapid scale up as well as technological developments, the price of solar power will attain parity with grid power at the end of the mission, enabling accelerated and large-scale expansion thereafter, he said.

The mission will utilise both solar thermal and photovoltaic technologies in the first phase. In addition, it would also focus on R&D and HRD to develop and strengthen Indian skills and enhance indigenous content to make the mission sustainable.

The mission will establish a single window investor-friendly mechanism, which reduces risk and at the same time, provides an attractive, predictable and sufficiently extended tariff for the purchase of solar power for the grid. The focal point, for the next 3 years, will be the NTPC Vidyut Vyapar Nigam (NVVN), which is the power-trading arm of the NTPC, he added.

NTPC Vidyut Vyapar will be the designated authority for the purchase of solar power generated by independent solar power producers, at rates fixed by the Central Regulatory Electricity Commission and for a period specified by the latter.

The government will provide equivalent MW of power from the unallocated quota of NTPC for bundling with solar power. The utilities will be able to account for purchase of solar power against their RPO obligations.

The mission also includes a major initiative for promoting rooftop solar PV applications. Solar tariff announced by the regulators will be applicable for such installations. The power distribution companies will be involved in purchase of this power.
 

NSG_Blackcats

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By 2022, govt to lay 18,637km of expressways​

The government has drawn up an ambitious target to lay 18,637km network of brand new expressways by 2022. These high-speed access controlled roads will be of the four-lane and six-lane variety with 3,530 km to come up in the next three years.

The highways ministry is ready with a Master Plan for the National Expressway Network . The new target of expressway length was projected after receiving observations from 11 states including Madhya Pradesh, Bihar, Gujarat , Karnataka and Uttar Pradesh. Earlier, the final draft report prepared by the highways ministry had proposed to develop 17,661 km of expressway network.

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RPK

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India may get USD 3 bn WB loan for roads development

New Delhi, Nov 25 (PTI) India may get USD 3 billion loan from the World Bank for development of roads in the country in the next 3-6 months, a senior Transport Ministry official said today.

"The Department of Economic Affairs has forwarded the request for the loan to the World Bank and we can expect to get it in 3-6 months' time, after the institution completes its due diligence," the official told PTI.

The government has sought loan for converting 6,372-km of 1-lane highways to 2-lane out of the total 19,702 km single lane highways in the country under National Highways Development Project (NHDP) Phase IV.

However, the mode of repayment of this loan has not been finalised yet.
 

NSG_Blackcats

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Govt seeks $2.96 bn World Bank loan for 2-laning of national highway​

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New Delhi: India has sought $2.96 billion loan from World Bank for two-laning of over 17,000 km of national highway in the country, road transport and highways minister Kamal Nath told Rajya Sabha on Wednesday. Replying to supplementary during question hour, he said World Bank has agreed to consider granting the new loan for the project.

“A proposal has been forwarded to World Bank to consider an assistance of USD 2.96 billion for development of non-NHDP (National Highway Development Project) National Highway sections in various states to two-lane standards,” he said. Despite some concerns over implementation of the National Highway projects, the World Bank has also agreed to look at funding of viability gap, he said.

He said there were 163 arbitration cases relating to Rs8,508.77 crore worth of highway projects under NHDP. Nath said land acquisition remains the single largest impediment in building of roads and pointed out that out of 218 projects completed under NHDP, 146 projects were completed behind schedule.

State governments have been requested to set up dedicated 192 Special Land Acquisition Units to speed up land acquisition exclusively for NHDP projects, he said, adding chief secretaries have been requested to head the monitoring committee in their states to accelerate land acquisition.

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NSG_Blackcats

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Srei-led consortium plans 400 MW power plant​

Kolkata: “A consortium led by Srei Infrastructure Finance Ltd plans to set up a 400-MW power plant in Haldia, West Bengal, for an estimated cost of Rs1,800-2,000 crore,” Hemant Kanoria, chairman, Srei said.

“We already have the land in possession and the total investment for the project is estimated at Rs1,800-2,000 crore,” he said on Wednesday.

“India Power Corp Ltd (IPCL) is a 50:50 consortium of Srei and Bhaskar Silicon Pvt Ltd and is operational since 2006,” he said.

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Oct crude oil output dips, gas rises​

New Delhi, Nov. 25 Domestic crude oil output continued with its declining trend in October, with production dropping by 2.2 per cent against the same month last year. Natural gas production remained robust registering a 44.2 per cent increase year-on-year. According to the data released by Petroleum Ministry, crude oil production in October fell to 2.85 million tonne (674,800 barrels a day). The decline in domestic crude output was led by lower production by ONGC.

The public sector exploration and production company produced 2.12 million tonne of oil in October, a 3.6 per cent decline. Output at ONGC’s Mumbai High fields that account for half of the domestic annual oil production fell 4 per cent to 1.48 million tonne. Natural gas production grew to 4.082 billion cubic metres (2.831 bcm). The continued growth in natural gas production is backed by production from Reliance Industries Ltd (RIL)-operated D6 block in Krishna Godavari Basin, which started production from April this year.

During the month, the domestic refiners processed 7.2 per cent more of crude oil at 14.26 million tonne (3.372 million barrels per day) from 13.30 million tonne a year ago, the data showed. The refinery throughput was up due to higher average capacity utilisation and increased crude processing by the refineries of Indian Oil Corporation. Refineries of Bharat Petroleum Corporation (Mumbai refinery), Hindustan Petroleum Corporation (Visakhapatnam), and Reliance Industries Ltd (Jamnagar) also exceeded their production targets. Capacity utilisation stood at 112.7 per cent in October.

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NSG_Blackcats

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To seek $2.95-billion loan from World Bank, the central government has created a new division within the National Highways Authority of India (NHAI) for developing expressways in the country. The government was looking to develop 17,000 km of expressways in the country during the next few years, said Road Transport and Highways Minister Kamal Nath.
 

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Reliance's D6 gas lights up idle capacity

With the Reliance Industries Ltd (RIL) operated KG-basin D6 block gas flowing in, the gas-based power generation across the country has registered a healthy turnaround.

In October, a total of 15 gas-based stations recorded a plant load factor (PLF) of over 80 per cent due to improved fuel availability, as against around just 50 per cent last year.

The spurt in gas-based production has more or less compensated for a dip in hydro generation in the northern and eastern regions, where reservoir storage was 35 per cent and 33 per cent respectively below last year's levels.
 

RPK

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RIL stops gas by-product sales to Iran


New Delhi, Dec 1 (PTI) Reliance Industries has since April stopped selling gasoline and gas oil to Iran in an apparent bid to escape sanctions by the US, where it is eyeing an acquisition.

RIL till last year sold mostly gasoline to Iran but has since April this year completely stopped shipments from its twin refineries at Jamnagar in Gujarat, sources in the know said.

US is seeking to restrict gasoline supplies from refiners to Iran over its suspected nuclear weapons programme. Some US senators had proposed giving President Barack Obama the authority to impose sanctions against companies supplying gasoline to Iran.

RIL, which is looking to acquire US-based chemicals company LyondellBasell, however, continues to buy 5-6 million tons a year of crude oil from Iran.
 

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Sea Link in troubled waters

Mumbai, Dec. 2 :The Bandra-Worli Sea Link has only been able to attract 30 per cent of the vehicular traffic plying between the Western suburbs and the Island city of Mumbai, in spite of five months in operation. This translates to a monthly loss of Rs 1 crore for the toll company, Mumbai Entry Point Pvt Ltd (MEPPL). Before the sea link was inaugurated in June, about 1,20,000 vehicles used the old Mahim Causeway to commute between the city and suburbs.

Today, only about 35,000 vehicles are opting for the sea link. The Maharashtra State Road Development Corporation (MSRDC) had projected at least 65,000 vehicles would use the link.

The MEPPL head, Mr Jayant Mahiskar, told Business Line that it is contracted to pay Rs 20 lakh per day to MSRDC as toll. But it has collected only about Rs 17 lakh toll, a daily loss of about Rs 3 lakh, "At Rs 20 lakh we break even and anything above that is our profit," he said.
 

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Single window clearance for hotel industry

NEW DELHI: In a move that will prove to be a major boost for hotel infrastructure, the tourism ministry has proposed setting up of a single window clearance system under the aegis of the Hospitality Development and Promotion Board.

The Board, to be established along the lines of the FIPB, will streamline permissions and clearances required for the hotel industry. Currently, there are as many as 64 clearances that are required to set up a hotel.
 

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DAE powers up nuclear generation target by 10,000 MW

The Department of Atomic Energy (DAE) has raised civil nuclear power generation to 30,000 MW by 2020 against the earlier target of 20,000 MW, said Dr S. Banerjee, Secretary, DAE, and Chairman, Atomic Energy Commission.

Dr Banerjee told Business Line that the growth plan for atomic energy has been worked out through a senior-level consultative process. This would come through indigenous development and imported reactors.

As of now, the indigenous programme would total up to 15,000 MW, though it was not 100 per cent domestic as it included the two foreign reactors for Koodangulam ( 2 X 1000 MW). Plans are also on to import more reactors before 2022. It could be a composition of 13 indigenous reactors and imported ones to total 30,000 MW-plus.
 

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India likely to access vast resources in eastern Siberia and far eastern Russia

A day after securing a civil nuclear cooperation agreement with Moscow to meet its growing energy needs, India on Tuesday secured promises for securing hydrocarbons from several Russian oil fields.

In an unanticipated development, Prime Minister Manmohan Singh’s intensive engagement in the Russian capital with President Dmitry Medvedev and Prime Minister Vladimir Putin led to understandings of immediate and long-term nature to access the vast Russian resources in eastern Siberia and far eastern Russia.

Mr. Medvedev gave an indication of enhanced partnerships in the energy sector when he observed on Monday that with the civil nuclear deal 3.0 in the bag, “we can think of working in other areas.”

Foreign Secretary Nirupama Rao said Russia agreed to allow India to enter the Trebs and Titov oil fields in the Timan Pechora region.

ONGC Videsh Limited (OVL) and Russia’s Sistema signed a memorandum of understanding to scout for oil and gas assets in Russia and other Central Asian countries. The Russian political leadership also gave a “very positive response” to India’s request to participate in the bidding for the lucrative Sakhalin-3 oil field.

With OVL having entered into tie-ups to study investment opportunities with Russian oil and gas giants Roseneft and Gazprom, Ms. Rao was confident of India obtaining sourcing rights in at least some of the projects.
 

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India's first commercial 2MW solar power plant inaugurated​

Amritsar: The country's first commercial 2MW solar power plant was today inaugurated by Union Minister of New and Renewable Energy Farooq Abdullah at a village near here. The plant, set up by American company Azure Power in IPP mode at Awan village, 45 kms from here, is proposed to be expanded to 5 MW and was inaugurated in the presence of Punjab Deputy Chief Minister Sukhbir Singh Badal and MP Navjot Singh Sidhu.

Abdullah said this was the country's first such plant and a very important step taken by the Punjab government in fulfilling the Union Government's target of producing 20,000 MW solar power by 2020 under its solar mission. He said his Ministry has launched a campaign to draw clean energy from Sun, Wind, Fire, Earth and Water.

In the new energy sector, he said the task of independent power producers was being facilitated by single window service in the Ministry, which was targeting 1300 MW power from the sector within next three years. Badal said the experiment would be soon replicated in total border belt of Punjab with three solar power plants of 10 MW each in each border district. Punjab had already achieved 282 MW in renewable power sector and was aiming 700 MW by 2011, he said. He said the state had plans to produce 300 MW power from 20 million tonnes rice husk, through 28 biomass plants being set up in Punjab.

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