Domestic gas prices may rise again as govt explores floor price mechanism

Agencies
September 28, 2020

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New Delhi, Sept 28: CNG and piped natural gas prices could face an increase this festive season if the government implements a new floor price mechanism for gas produced from domestic fields by companies such as Oil and Natural Gas Corporation (ONGC).

Sources said the petroleum ministry is considering a proposal under which domestic gas will have a floor pricing that would prevent fuel prices from crashing below an identified threshold in the current subdued market conditions and insulate oil and gas explorers like ONGC from a tariff crash.

Talks are on to link gas prices with price Japan-Korea Marker, a benchmark index used to determine LNG tariff in North Asia with a discount.

With JKM prices hovering over $ 5 million British thermal units (mmBtu) even with day $ 1 mmBtu discount, the Indian gas floor price under this formula will be close to $ 4 mmBtu. This is much higher than the government administered price of $ 2.39 mmBtu for the April-October, 2020 period. And if implemented, it could increase the cost for all gas consumers.

"Nothing has been finalised on having a gas floor price as of now. A panel in the petroleum ministry is looking at various options and the best course would be adopted that has little impact on consumers but also supports oil and gas companies with remunerative and sustainable gas prices."

The average cost of gas production for the country's largest public sector oil company ONGC is about $3.7/mmBtu, much higher than the current regulated price of natural gas at $2.39/mmBtu. This is expected to fall further to about $1.9/mmBtu for the next six months beginning October 1 under the current formula, sources said.

Lower gas prices is bad news for ONGC as it would mean further suppressed margins and losses. The company is set to lose close to Rs 6,000 crore on low gas prices this year, brokerages have said.

Brokerages have put ONGC's FY22E gas price at US$3.6-4.2/mmbtu depending on discount to JKM price if the new floor price is implemented. With Low L NG liquefaction capacity addition ahead, JKM spot futures for FY22-FY26E are expected at US$5.2-5.8/mmbtu vs US$4.7-4.1/mmbtu in FY20-FY21E.

Oil minister Dharmendra Pradhan had said earlier that India will phase out price controls in natural gas and make it market-linked soon.

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News Network
March 27,2024

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New Delhi, Mar 27: The government has objected strongly to remarks by a US State Department spokesperson on Delhi Chief Minister Arvind Kejriwal's arrest last week in connection with the alleged liquor policy scam.

The External Affairs Ministry summoned Gloria Berbena, the US' Acting Deputy Chief of Mission, to a 40-minute meet at its office in Delhi on Wednesday afternoon. In a brief statement released shortly afterwards, the MEA warned of "unhealthy precedents and against "unwarranted aspersions".

"States are expected to be respectful of the sovereignty and internal affairs of others, and this responsibility is even more so in case of fellow democracies. It could otherwise end up setting unhealthy precedents," the External Affairs Ministry said.

"India's legal processes are based on an independent judiciary which is committed to objective and timely outcomes. Casting aspersions on that is unwarranted," the statement stressed.

On Tuesday the US State Department said it is monitoring reports of Mr Kejriwal's arrest, and called on New Delhi to ensure "a fair and timely legal process" for the jailed Aam Aadmi Party leader.

The US State Department's comments came, in turn, days after Germany's Foreign Office stressed that Mr Kejriwal, like any other Indian citizen facing charges, is entitled to a fair and impartial trial.

The Indian government reacted strongly to the comment, summoning the German envoy and labelling the Foreign Office spokesperson's remark "blatant interference in internal matters".

"We see such remarks as interfering in our judicial process and undermining the independence of our judiciary," the External Affairs Ministry said, "Biased assumptions are most unwarranted."

Asked about India's protest to Germany, the State Department spokesperson told Reuters, "We refer you to the German Foreign Ministry for comment on their discussions with the Indian government."

Earlier this month the Modi government also took exception to comments by its counterpart on the changes to the citizenship law, calling them out as "misplaced, misinformed, and unwarranted".

Arvind Kejriwal was arrested by the Enforcement Directorate last week in connection with the alleged liquor policy scam that has roiled his AAP and provoked furious protests from the opposition ahead of the 2024 Lok Sabha election. Mr Kejriwal was this week sent to jail till March 28.

The Enforcement Directorate believes the now-scrapped liquor policy provided an impossibly high profit margin of 185 per cent for retailers and 12 per cent for wholesalers. Of the latter, six per cent - over ₹ 600 crore - were bribes and the money was allegedly used to fund the AAP's poll campaigns.

The ED has labelled the Chief Minister as a key conspirator in this case, but Mr Kejriwal and party colleagues arrested in this matter - ex-Deputy Chief Minister Manish Sisodia, Rajya Sabha MP Sanjay Singh, and former Health Minister Satyendar Jain - have all denied the charges.

The AAP and the opposition have hit out at the BJP-led central government for using central agencies, like the ED, to target rivals and critics before the general election. The AAP has criticised Mr Kejriwal's arrest on grounds it was timed to interfere with his plans to campaign for the party.

The BJP has dismissed claims it uses central agencies as described by the opposition.

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News Network
March 27,2024

Bengaluru: The National Investigation Agency (NIA) on Wednesday launched simultaneous raids in multiple places, including Bengaluru and Shivamogga.

Reports suggested that the ongoing raids are in connection with the Improvised Explosive Device (IED) blast in Bengaluru’s Rameshwaram Cafe on March 1. The blast had injured at least ten people as per the police report.

The Central Crime Branch (CCB) had launched an investigation alongside the NIA, and the trail of the suspect led them to Tumakuru first and subsequently to Ballari. Investigators believe that the bomb was planted by Mussavir Hussain Shazib, a handler of the Islamic State’s Shivamogga module who was aided by another IS handler called Ahmed Taahaa.

Sources in the know said that Shazib and Taahaa had stayed in Chennai for about a month between January and February using fake credentials. The names of the suspects were identified after they traced the cap worn by Shazib to a shop in a mall in Chennai. The cap, which was abandoned by the bomber in Bengaluru after the blast, was reportedly bought by Taahaa, around January-end.

As per the NIA, Shazib hails from Masjid Road in Thirthahalli, Shivamogga district, and Taahaa from Fish Market Road, Soppu Gude, Thirthahalli Rural. Both "wanted" suspects have been termed "absconders" by the NIA.

The NIA has questioned seven jailed terror suspects so far in connection with the blast. The investigation agency had also obtained seven-day custody of a jailed terror suspect named Maaz Muneer Ahmed.

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News Network
March 16,2024

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Ottawa, Mar 16: An Indian-origin couple and their teenage daughter were killed in a "suspicious" fire which tore through their home last week in Canada's Ontario province, police said on Friday.

A fire engulfed a home at the Big Sky Way and Van Kirk Drive area of Brampton on March 7, a press release by the Peel Police said.

After the blaze was put out, investigators located what was believed to be human remains within the gutted house, but the number of people killed couldn't be ascertained at the time.

The charred remains were on Friday identified as those of three family members: 51-year-old Rajiv Warikoo; his wife, 47-year-old Shilpa Kotha; and their 16-year-old daughter, Mahek Warikoo.

Police said that they resided at the address before the fire.

Peel police Constable Taryn Young on Friday said the fire had been deemed suspicious, the CTV news channel reported.

"At this time, we are investigating this with our homicide bureau, and we are deeming this as suspicious as the Ontario Fire Marshal has deemed that this fire was not accidental," the report quoted Young as saying.

"There's not much left to it," Young said when asked about the possible cause of the fire.

"Looking into something like that as a fire marshal, I'm sure it's very tough when there is not much left to look at. But we are exhausting all avenues," she said.

The deceased family's neighbour, Kenneth Yousaf, said that the family had lived on the street for about 15 years, and he never noticed any problems with them.

Yousaf said he was alerted to the fire last week by a family member, who heard a big "bang." "When we came out, the house was on fire. So sad. Within a few hours, everything was down to the ground," the report quoted Yousaf as saying.

In a press release, police said they are continuing to investigate the deaths of the three family members and urged anyone with information to come forward.

"The circumstances surrounding the house fire remains the focus of an active investigation, and anyone with information or video footage (dashcam or otherwise) is urged to contact Homicide detectives," police said.

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