GAIL's US commitments: Markets are nervous

GAIL's committed LNG volumes from the US are expected to land in India from next month.
That is when the countdown begins on how the gas major's US offtake will eventually impact its bottomline.
GAIL is remarkably reticent to share information on where it has tied up its volumes, as it claims it has.
But a reasonable number of cargoes are expected to land in India
Even though the company's other baseline parameters, including petrochemical capacity, gas transmission volumes and tariffs, are all expected to be up, the US LNG risk overwhelms all positives.

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Oil & gas logistics in India: Opportunities galore

Oil & gas storage logistics has become a highly lucrative niche business in India.
First mover firms are reaping the benefits of the growing need for storage and logistics as public sector companies run out of space.
A secondary distribution market has emerged with good margins given the growing economy.
The website carries here an example of how private companies are stepping in to plug the gap.
Clear business opportunities are available, both from the view point of the investor as well as the supplier of equipment and services.

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LNG shipping: Tightening up

The LNG shipping market is likely to show signs of tightening up soon in the face of rising supplies.
The expectation is that the tightening will happen from the current quarter and the trend will continue right up to 2020
There is a big net decrease in available tonnage
Then again, the number of uncommitted newbuilds has come down
New-tech LNG vessels are enjoying a significant premium over their conventional counterparts
In fact, a three-tier LNG market has evolved as of now

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Indian offshore vessel industry: Wait out for the good times to come.

So, after disappointing global growth over the past few years, the recent allround economic pickup combined with the relatively subdued fleet growth provides an ideal window of opportunity for the shipping industry to enjoy good returns.
So expect shipping companies to do better this year
The expected uptick in oil & gas vessels may not happen this year but the worst is over. A rapid expansion is now projected going ahead, and increased activity will go on until 2027, as per projections already carried here
The industry needs to just sit it out before the party begins

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ONGC on the rise: Gas volumes to go up 40%

It is all good for ONGC from here onwards
Gas volumes from upcoming investments are expected to go up by close to 40% in 4 years
The highly profitable new petchem capacity (OPAL) will ramp-up to 80% utilisation by March 2018 from current 50%
Realisation will jump: APM gas price will structurally revive with a lag to oil price rise.
Moreover, most new fields will attract ~2x APM gas price
Cost efficiencies will improve: Operating costs will remain low post the 32% fall since CY16, due to lower equipment costs and higher drilling efficiencies. 

Prices to rise, costs to come down

Find out by how much will ONGC gas output go up anually over the next four years
When is the KG-DWN-98/2 likely to kick start?
By how much is APM and non-APM price expected to go up over the next four years?
And by how much have finding costs gone down?
And by how much has offshore drilling costs reduced?
What kind of further opex saving does the company expect?

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Petrochemical industry: Know more

Find our more on the following topics:
Is India ready to embrace value added petrochemicals?
A case for development of benzene value chain in India – lessons from China
Maximizing refinery margins by Petrochemicals Integration
Coal to olefins – relative economics in low crude oil regime & status of projects in China
Logistics and supply chain dynamics for petrochemicals

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BP maintains a stiff upper lip in India: Onus falls on RIL to manage the relationship

BP is a huge global oil & gas conglomerate and it has a big presence in India through the RIL-BP collaboration which is trying to dig out more gas in the KG Basin
And yet, globally, its reputation among oil and gas professionals is much lower than its heft
A recent survey of global professionals shows that BP's credibility is significantly lower than many companies with a far lower footprint.
Shell and Exxon Mobil, and even companies like Statoil and Cairn score higher than BP
In India too, BP maintains a stiff upper lip and an inflexible demeanor, incommensurate with its prowess, thereby losing both credibility and power, not just with the government but with other stakeholders as well.
It is the failure of the local team to do the footwork that leaves BP's swashbuckling CEO Bob Dudley to do most of the liaisoning directly with key Indian stakeholders.
The abject failure of the BP team to make a mark in New Delhi's corridors of power has forced the responsibility entirely on RIL to be the big partner in the relationship.
It is time for a wholesale managerial change in BP. 

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