Petronet eyes capacity at LNG terminals in US, Australia

With domestic gas output falling, companies are looking at new LNG contracts to meet the growing energy demand. Besides Petronet, state-owned gas utility GAIL India, too, is looking to acquire capacity at proposed LNG terminals on the US Gulf Coast

New Delhi: Petronet LNG, India’s largest liquefied natural gas importer, is in talks to acquire capacity at proposed LNG terminals in the US and Australia with a view to tie up long-term gas supplies, reports PTI.

“Five projects (in the US) have applied to US authorities for approval to export gas,” Petronet CEO and managing director AK Balyan told reporters here. “We are talking to some of them with an aim to tie up long-term volumes.”

However, he refused to give details.

With domestic gas output falling, companies are looking at new LNG contracts to meet the growing energy demand.

Besides Petronet, state-owned gas utility GAIL India, too, is looking to acquire capacity at proposed LNG terminals on the US Gulf Coast.

So far, Cheniere’s Sabine Pass, Freeport LNG and Southern Union’s Lake Charles are the three projects that have applied to export LNG.

“We have to see how export permissions work out,” Mr Balyan said, adding Petronet was looking at picking up equity in the terminals to get better pricing of gas.

Petronet imports 7.5 million tonnes a year of LNG from RasGas of Qatar on a long-term contract at its Dahej terminal.

It is also looking at supplies from the US and Australia among others to feed the 25 million-tonnes-a-year LNG import capacity it will have by 2015-16.

Balyan said Petronet is expanding the Dahej terminal capacity to 15 million tonnes a year from 10 million tonnes in next 40 months while building a new import facility at Kochi in Kerala.

Another 5 million tonnes facility is planned on the east coast for which three sites—two in Andhra Pradesh and one in Orissa have been short-listed.

Petronet reported almost doubling of its net profit at Rs260.33 crore in the quarter ended 30th September, on the back of higher volumes it imported in the three-month period.

“We regassified 135.08 trillion British thermal units (Btu) of gas in July-September as against 99.78 trillion Btu in the same period a year ago,” he said, adding that besides the long-term LNG contract from Qatar, the company imported 12 cargoes from the spot market in the quarter.

It had not imported any shipload of LNG in Q2 of previous year.

“We hope to maintain the trend (during the current quarter). Import from spot market should be 12 to 14 cargoes,” he said.

Petronet in all imported 42 cargoes or shiploads of LNG (natural gas liquefied at sub-zero temperature). Of these, Petronet imported six cargoes from spot market by itself and an equal number were contracted by its promoters, GAIL and Gujarat State Petroleum Corp (GSPC).

Petronet’s total income increased from Rs3,076.31 crore in the second quarter of the 2010-11 fiscal to Rs5,386.98 crore in the current financial year.

Mr Balyan said the company board had sanctioned an ESoP scheme for its employees. Petronet shares will be bought from the market by a company-managed trust, which will then give them to employees who have completed more than five years with the company and high-performing individuals.

“There will be no equity dilution,” he said.

Petronet operated the Dahej terminal at 106 per cent of its nameplate capacity of 10 million tonnes a year during the July-September quarter, he said adding the Dahej expansion would cost Rs3,000 crore.

The expansion would be funded by 70% debt.

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Five states to contribute Rs50 lakh crore industrial output by 2016

Identified as states with ‘great potential’, Andhra Pradesh, Gujarat, Karnataka, Maharashtra and Tamil Nadu are projected to increase their industrial production by more than two-and-half times to Rs50 lakh crore in the next five years. But to achieve the milestone, these states will require 1.72 lakh acres of land for industrial use, according to a study by the global property consultant Knight Frank

New Delhi: Identified as states with ‘great potential’, Andhra Pradesh, Gujarat, Karnataka, Maharashtra and Tamil Nadu are projected to increase their industrial production by more than two-and-half times to Rs50 lakh crore in the next five years, reports PTI.

But to achieve the milestone, these states will require 1.72 lakh acres of land for industrial use, according to a study by the global property consultant Knight Frank.

“Our analysis clearly indicates that industrial output (in these states) over the next five years will touch Rs49.40 lakh crore by 2016 from the current Rs19.35 lakh crore and is expected to grow at an annual rate of 21%,” it said.

The study carried out by Knight Frank India has identified the five states as “the most industrialised states which also offer a great future potential”.

The petroleum sector alone would contribute nearly one-third of the industrial output followed by metal and chemicals.

During the last 10 years, engineering and chemical industries have witnessed the highest growth while petroleum has emerged as the largest industry in the country, it said.

“Our research shows that the petroleum industry dominates the industrial scenario in Gujarat, Karnataka and Maharashtra and we estimate that the sector will continue lead in 2016,” Knight Frank India research head Samantak Das said.

Even in Andhra Pradesh, the industrial landscape is poised to witness a transformation. The food processing industry will be overtaken by the petroleum sector.

This will happen as the petroleum sector would grow by 28% as against 17% expansion projected for the food processing, it said.

Similarly, automobile industry which leads the industrial activity in Tamil Nadu would maintain its position.

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COMMENTS

Anil Agashe

5 years ago

This would be tragic if it were to happen. The policy should be to take investments to states which need it desperately. Lopsided development will cause social tensions in future.

SAT rejects Sahara appeals; orders refund of money to investors

Describing the SAT order asking its two companies to repay investors as shocking, the Sahara group said it will appeal against the order in the Supreme Court

Mumbai: Rejecting the appeals of Sahara Group companies, the Securities Appellate Tribunal (SAT) on Tuesday asked the group to refund the money raised through Optionally Fully Convertible Debentures (OFCD) to investors within six weeks, reports PTI.

“...both the appeals are dismissed...The appellants in both the appeals shall now repay within six weeks from today the amount collected from investors on the terms as set out by the whole time members (of SEBI) in the impugned order,” SAT said in its order.

While dismissing the appeal filed by Sahara Group companies against the Securities and Exchange Board of India (SEBI) order, it held that the market regulator has jurisdiction over such fund raising schemes.

“...we may mention that in view of our findings that OFCDs issued by the company are securities and that the issue was a public issue requiring mandatory listing and that SEBI has the jurisdiction under the SEBI Act to deal with all kinds of securities and companies, whether listed or not...,” the order said.

It could not be immediately ascertained how much money the Sahara companies would have to refund to investors who had parked their funds as OFCDs.

SAT has given the two companies—Sahara India Real Estate Corporation (now known as Sahara Commodity Services Corporation Ltd) and the Sahara Housing Investment Corporation—six weeks to return the money.

SEBI had in June asked the two Sahara group entities to return money collected from millions of investors through a financial instrument OFCD citing violation of regulatory norms.

The Sahara Group had challenged the SEBI order in SAT. It contended that SEBI has no jurisdiction over the issue as the companies involved were not listed. It maintained that entities involved were privately held companies and were under the jurisdiction of the ministry of corporate affairs (MCA).

A similar issue was raised by Sahara in the Supreme Court which had asked it to approach the SAT in the matter.

Dismissing the contention of Sahara which was represented by senior advocate Fali S Nariman, the SAT order said: “This argument has no merit... A plain reading of Regulation... leaves no room for doubt that the regulations apply to all public issues.”

SEBI had earlier in June had asked the two companies to refund the money raised from hybrid instrument OFCD to investors along with 15 interest.

The two companies and its promoter Subrata Roy Sahara, and the directors—Vandana Bhargava, Ravi Shankar Dubey and Ashok Roy Choudhary—jointly and severally were told to refund the money collected.

Besides, the regulator had also restrained the entities from accessing the securities market for raising funds, till the time payments are made to the satisfaction of SEBI.

Although the total amount raised by the two companies is not known, the Sahara companies have been raising money since 2008. The companies have been collecting money through different schemes from investors which has been estimated at several millions.

The companies had failed to apply for and obtain listing permission from recognised stock exchanges, SEBI had said in its earlier order.

Meanwhile, describing the SAT order asking its two companies to repay investors as shocking, the Sahara group said it will appeal against the order in the Supreme Court.

“We have decided to go in for appeal against the impugned SAT order in the Horourable Supreme Court,” Sahara said in a statement.

It said the SAT order was ‘unbelievably shocking’ and was in contradiction to the views expressed by many authorities earlier on similar issues.

“We have been left speechless and astonished to see the verdict of SAT. Our firm belief is that nobody can prove right as wrong,” it said.

The statement came in wake of the SAT order which rejected its appeal against SEBI verdict and asked the Sahara group entities to refund the money raised through OFCDs to investors within six weeks.

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