This is the company’s second oil major find after the offshore oilfield in the Krishna-Godavari basin.

The new oil find is expected to help increase domestic fuel supplies.

In a statement, Reliance Industries said that it struck oil in the 5th well it drilled on the 635-square-kilometre CB-ONN-2003/1 block in the Cambay Basin, located about 130 kilometres from Ahmedabad, in Gujarat.

Reliance Industries holds 100% participating interest (PI) in CB-ONN-2003/1 block.

The block, spread over an area of 635 square kilometers, has two parts – Part A situated in the west, with an area of 570 square kilometres, and Part B lying to the east, having an area of 65 square kilometres.

The company did not, however, disclose how much reserves the new oilfield might hold.

The CB-ONN-2003/1 block was awarded to Reliance Industries Limited in the 5th round of bidding under the New Exploration Licensing Policy (NELP).

Reliance Industries Limited, the most valuable company in India, holds 100% participating interest in the CB-ONN-2003/1 block.

The statement from Reliance Industries said that the 5th well on the Cambay onland block – CB10A-A1 – was drilled to a depth of 1451 metres. The well gave out around 500 barrels of oil a day at the time of conventional testing.

According to the company, the new oil find – named ‘Dhirubhai-43’ – is expected to open “future potential within the block” and that the commercial viability of this discovery is being established through gathering more data and though analysis.

RIL said that while the 3D Seismic data has been obtained over 80% of the area in the block, the 2D Seismic data from the entire area has been received.

It may be noted that Reliance Industries Limited, the largest operator of gasfield in India, had not taken part in an auction of 70 oil and gas blocks held in 2009, for which 36 bids had been received.

Earlier, the company had come across reserves of crude oil in the mainly gas-rich KG D-6 block, off India’s east coast. The Mukesh Ambani Field (MA Field), which started production in September 2008, at present yields about 11,000 barrels of crude oil a day.

Reliance Industries is the biggest conglomerate in India, with interests in oil refining, petrochemicals, exploration of oil and gas, and retailing.

India imports over 75% of crude oil it requires.

According to analysts, the country’s production of crude output is likely to increase by 11% to 36.7 million metric tones in 2009, thanks to the starting of production at an oilfield in Rajasthan that is operated by Cairn India Limited.

Net income in the second quarter rose to Rs 5,090 crore, or 23.8 rupees a share (EPS), Rs from 4,808 crore, or 22.48 rupees apiece, the New Delhi-based ONGC said in a statement to the Bombay Stock Exchange yesterday. Sales declined to Rs 15,080 crore from Rs 17,407 crore a year earlier.

ONGC  said profit also rose after the government allowed ONGC to cut discounts given to state-owned refiners such as Indian Oil Corp (IOC)., reducing the explorers subsidy burden. ONGC sold crude at $56.42 a barrel in the quarter after giving discounts, 21 percent higher than last year. Discounts to state refiners fell 80 percent to Rs 2,630 crore in the quarter from Rs 12,663 crore.

ONGC has to sell crude oil at a discount to the state refiners to help them compensate for losses from selling petrol and diesel below cost. ONGC was exempted from bearing losses from sale of kerosene and liquefied petroleum gas.

The company’s total expenses during the second quarter of 2009 fell to Rs 8,713 crore from Rs 11,177 crore. Interest payment dropped to Rs 3.54 crore from Rs 97.4 crore in the year-ago quarter.

The explorer plans to spend Rs 24,720 crore in the year ending March 2010, ONGC said in a statement posted on its web site. ONGC said it has made five oil and gas discoveries in the quarter ended September and another four this month.

ONGC said it plans to add 72.65 million tons of ultimate oil and gas reserves in the year ending March 2009 and 76.17 million tons in the subsequent year against actual of 68.90 million tons in 2008-09.

Reliance Industries Limited, India’s biggest company by market value, said its 2009-2010 fiscal second quarter profit fell 6.4 percent to 3,852 crore rupees on lower refining earnings. This is the fourth straight decline in quarterly profit reported by the company as a global recession weakened fuel demand.

Mumbai-based Reliance said its net profit in the three months ended September 30 fell to 3,852 crore from 4,116 crore rupees a year ago, its fourth straight decline in quarterly profit. Sales rose to 46,848 crore from 44,688 crore rupees last year, Reliance said in a statement posted on its web site.

Reliance Industries, which operates the world’s largest refining complex, reported a 51 percent drop in the revenue it earns from processing each barrel of crude as oil prices fell from last year’s record highs. The company owned is Mukesh Ambani, India’s richest man, is investing in exploration to cut depended on refining.

The company started producing gas from KG D6, its biggest discovery off India’s eastern coast, in April. Reliance said it produced 40 million standard cubic metres of gas from the find in the six months to September.

The refiner earned $6 on every barrel of crude turned into fuels in the September quarter compared with $13.4 a barrel a year ago. Global refining margins have fallen to $3.42 a barrel in the quarter compared with $6.20 last year, according to BP Plc data.

Earnings from Reliance’s petrochemicals business rose 16 percent in the quarter on higher demand and help from a fall in the rupee, the company said.

Reliance said it earned $7.5 billion in the six months to September from exports of fuels from its refinery located at Jamnagar in Gujarat. It exported for about 13.2 million tonnes of fuels compared with 11 million tonnes last year, the company said.

The company’s outstanding debt as on September 30, 2009 was 71,349 crore rupees against 73,904 crore on March 31, 2009, Reliance said. The company, which has the highest weightage on the Bombay Stock Exchange’s 30-share Sensitive Index Sensex, offered stockholders a bonus of one share for each equity share owned in Reliance earlier this month.

Reliance Industries fell over 1 percent on Friday morning trading, a day after it posted it released its quarterly reports for Q2 2009.

Chittaranjan Pradhan, chairman and managing director of the National Aluminium Company, told reporters that a power plant is being built at Jharsuguda. A smelter plant in Iran is on the cards. In addition, NALCO proposes to build coal-based power plant in Indonesia.

According to A K Sharma, NALCO’s director for production, setting up a nuclear power plant is “an additional business line” which will help the company earn money by being an independent producer of power.

However, both Pradhan and Sharma declined to divulge the amount of money that NALCO would invest in the planned nuclear power plant.

National Aluminium Company, the third largest aluminium-manufacturer in India, produced 361,262 tonnes of aluminium in the fiscal 2008-09 ending March. The company has a 960-megawatt thermal-power plant in Angul in Orissa which feeds its aluminium smelter plant in Orissa.

According to Chittaranjan Pradhan, the NALCO administration’s commitment as well as the joint efforts made by the residents and the company’s authorities have brought about development and made the people self-reliant in the villages adjoining the company’s project in Damanjodi.

He said the company’s machinery at the Damanjodi had been upgraded “to match the best in the industry.” However, the input still cost stays high – with 21% of the total costs accounting for human resource management.

Pradhan stressed that there is a need to come up with better results with minimum inputs, more so at a time when the aluminum-making sector is facing hard times because of the global economic depression.

NALCO, he added, is planning huge expansion both in India as well as overseas by maximum utilisation of its human resource. High-grade bauxite reserves of the mines at Pottangi would support the third-phase expansion of the plant. The process for acquiring the mines is in its final stage.

The deals to acquiring mining areas at Gudem and K R Konda mining sites at Chintapalli in Visakhapatnam district of Andhra Pradesh and some other places in the Godavari region of the state would be finalised soon.

Mongolia, which is supposed to have plentiful reserves of uranium, is the 6th country with which India has entered into a civilian nuclear agreement after the 45-nation Nuclear Suppliers Group (NSG) revoked the 34-year-old ban on India. The NSG ban had prevented India from trading in the areas of radioactive substances and nuclear energy with other countries.

Mongolia is believed to have about 6% of the total uranium reserves in the world.

India already has civilian nuclear agreements in place with the United States, France, Russia, Namibia and Kazakhstan.

The new agreement – called the ‘Memorandum of Understanding on Development of Cooperation in the field of Peaceful Use of Radioactive Minerals and Nuclear Energy’ – will enable India to seek uranium from Mongolia.

The accord on nuclear power plus four other agreements were signed after detailed discussions held between India’s Prime Minister Manmohan Singh and Mongolia’s President Tsakhiagiin Elbegdorj in New Delhi.

After signing the pacts, Prime Minister Manmohan Singh told reporters that both India and Mongolia have also agreed to cooperate strongly the fields of mining, agriculture, health, statistical affairs, and cultural exchange.

Besides, the two nations also agreed upon bilateral investment protection and on ways to avoid double taxation, and on boosting cooperation, including the issue of terrorism and UN reforms.

India promised Mongolia a stabilisation fund worth US $25 million in order to ease the ill-effects of the worldwide economic recession on Ulan Bator, the capital of Mongolia and the country’s biggest city.

Mongolia’s President Tsakhiagiin Elbegdorj said his country is “grateful to India for having provided stabilisation funds for the resurgence of its staggering economy.”

The visit to New Delhi is Elbegdorj’s first official visit overseas after he became President of Mongolia in June 2009.

President Elbegdorj is accompanied by a high-level delegation consisting of officials and businessmen, including the Minister for Education, Science and Culture; the Minister for Foreign Affairs; the Minister for Trade; and senior parliamentarians.
The Foreign Investment and Foreign Trade Agency of Mongolia (FIFTA) and the Federation of Indian Chambers of Commerce and Industry (FICCI) signed a memorandum of understanding (MoU) aimed at strengthening cooperation between India and Mongolia in the fields of trade and investment.

Mark Ginberg, senior official with the United States Department of Energy, who attended the launch of the project, said that a total of 60 cities in India should have to be solar-powered by 2020 if the country is able to generate 20,000 megawatts of solar energy by that time.

In all, 20 cities in India have already been lined up for the solar-energy programme and these cities will partner with cities in the United States to achieve the goal, Mark Ginberg said.

Ginberg is also senior executive adviser to the assistant secretary of the Office of Energy Efficiency and Renewable Energy in the United States Department of Energy.

Initially, the following cities in India and the United States, respectively, have been tied up in the programme: Bangalore with San Francisco; Chennai with Denver; Ahmedabad with Atlanta and Columbus; Mumbai with Los Angeles; Delhi with Chicago; Vadodara (Baroda) with Edison and New Jersey; and Surat with Philadelphia.

This partnership will enable institutions in India like schools to study energy-smart schools in the United States and, if needed, implement in India the activities going on there, according to Vatsal Bhatt, coordinator of the United States-India-China city partnership for sharing best practices in energy and environment.

For instance, Mumbai port can get on-field experience as to how the Los Angeles port has adopted energy-smart steps, Bhatt, who is an energy analyst at Brookhaven National Laboratory, said.

Mark Ginberg said that the United States government, which has realised the importance of renewable energy, is spending billions of dollars for renewable-energy projects in that country. The Barack Obama administration has set apart as much as $60 billion for projects connected with renewable energy and energy efficiency.

Bharatsinh Solanki, Union minister of state for power, said India could make use of its rooftops of houses as well as open fields to harness solar energy and also for water harvesting.

Solanki said Delhi is considering setting up an energy efficiency board. Though nuclear energy is the answer to the power needs of the future, India has financial constraints on this score, he added.

The launch of the joint training program on ‘Energy-efficient and green cities’ held in Goa was attended by mayors and civic officials from 30 cities in India and abroad.

Moser Baer India has won the engineering procurement construction (EPC) contract for the 1-megawatt solar project by Mahagenco, a power generation company owned by the government of Maharashtra.

Moser Baer was awarded the contract based on a global tender, in which 20 companies took part.

According to a press release from Moser Baer India, the project will be commissioned in consortium with SunEnergy GMBH, a specialised photovoltaic (PV) systems company headquartered in Germany.

SunEnergy GMBH has over 10 years of experience in commissioning large solar-power projects.

Moser Baer Photovoltaic and PV Technologies India, which are engaged in producing photovoltaic solar cells and plants, are the subordinates of Moser Baer India.

The planned solar-power farm at Chandrapur would be one of the biggest of such projects anywhere in the world using amorphous silicon (or, thin film) photovoltaic technology.

Included in the terms of agreement in the contract are commissioning of the solar-power project by January 2010 as well as its maintenance thereafter.

In the press release, Rajiv Arya, chief executive officer of Moser Baer’s photovoltaic business, said that the proposed plant to be set up at Chandrapur would “showcase the company’s EPC as also project its development capabilities.”

Meanwhile, in another “green” development, the government of Gujarat has approved 34 solar-power projects at an investment of Rs 12,000 crore (Rs 120 billion, or $2.4 billion) over the next some years.

According to an official of the state government-managed Gujarat Energy Development Agency (GEDA), the planned solar-power projects would help Gujarat rank first in India vis-à-vis clean energy.

The 34 projects are expected to add 716 megawatts of power to Gujarat’s electricity grid – making for 2%-3% of the state’s total power requirement.

The 34 solar-power plants, the official explained, would generate a total of 1,250 million units of eco-friendly electricity each year, resulting in doing away with the use of as much as 875,000 tonnes of coal and emission of 1.25 million tonnes of carbon dioxide annually.

Carbon dioxide is the greenhouse-gas that has been mainly blamed for climate change, and climate change is already hitting agricultural production, causing more droughts, storms and floods, as well as raising the sea level hazardously.
It may be noted that India is one of the nations that has been hit badly by the ill-effects of climate change.

According to the latest annual Economic Survey, India is spending 2.6% of its gross domestic product (GDP) – which comes to about $1.2 trillion – to tackle the effects of climate change.

And, the National Action Plan on Climate Change has identified solar power as the main alternative means to produce clean electricity since thermal power plants that use coal are the biggest source of carbon dioxide emissions worldwide.

“The company plans to raise output from the deep-sea field in the Bay of Bengal by 10 mmscmd a month, reaching peak production of 80 mmscmd by the end of this year.” P.M.S. Prasad, the chief executive of Reliance’s oil and gas business said.

“We are signing 15 contracts with 12 companies and the volumes are about 15 mmscmd.” he added.

The gas will start filling the pipes in a couple of days and Reliance Industries will start supplying the gas from KG basin by mid April 2009.

RIL will start the production at about 10-12 million standard cubic meters per day of gas when it commences in April, and by mid-July, will increase the production to 40 million standard cubic meters per day and then reach the peak production of 80 million standard cubic meters per day in an year.

Against the current demand of 190 million standard cubic meters per day of gas in India, the supply of 80 mmscmd falls short of India’s full requirement by 110 mmscmd and gas production from the RIl KG basin D6 block will help cut down the gap between the supply and demand.

As per the production sharing deal with the state, the company will be paying 10 per cent as profit petroleum to the government. Oil companies do this in order to comply with the regulations governing India’s oil and gas exploration policy.

We had first written about Reliance’s KG basin project in 2006.

IOC in a statement said to Bombay Stock Exchange that it owns 74% in BRPL and that the merger will be effective from today itself. IOC will issue 4 shares in every 37 they own in BRPL.

“The Ministry of Corporate Affairs (the competent authority to approve mergers of Government companies) has sanctioned the Scheme of Amalgamation for merger of BRPL with IOC,” the company said.

IOC had nodded for the merger with BRPL in November 2006. BRPL owns 2.35 million tons a year oil refinery in Assam.

“Consequent upon filing of the Order of Amalgamation with the Registrar of Companies (ROCs) in Shillong and Mumbai and the same being taken on record by the respective ROCs, BRPL stands dissolved and the merger becomes effective March 25,” the statement said.

Consequential of the merging the government decided to sell its take in BRPL and Chennai Petroleum Corp Ltd to IOC.

“The Scheme of Amalgamation provides for a swap ratio of 4:37 i.e. four equity shares of Rs 10 each of IOC as fully paid for every 37 equity shares of Rs 10 each of BRPL,” the company added in its regulatory statement.

This is Reliance Power’s third contract in a row, after Sasan in Madhya Pradesh and Krishnapatnam in Andhra Pradesh.

Reliance bid for an amount of 1.77 Rs. per unit, leaving behind other competitors like NTPC who bid for 2.34 Rs. per unit and Jindal Steel and Power Limited who bid 2.67 per unit. The other bidders included Vedanta group and Sterlite and Lanco. The bid by Reliance Power as per analyst is a very aggressive bid as the gap between the top two is comprehensive, although this bid is bigger than the 1.19 per unit made for the Sasan project.

Initially, eleven companies were qualified for the Tilaiya UMPP project, but due to the continuing worldwide slowdown credit crisis saw many back away from the bid. Those who backed out include companies like Tata Power, Essar Power and Larsen & Tubro.

“Given the turmoil in the global markets, it would take more time before conditions are conducive for financing such large projects,” Lanco Infratech which withdrew from the bidding said in a statement to the Bombay Stock Exchange after coming out as the highest bidder.

The Tilaiya project is assumed to be cheaper than the Sasan project as there is a slide in steel price and the ease which Jarkhand coal mines provides. The project will use domestic coal which will be mined from a captive expanse that will be allocated for the project developers. The complete project will cost somewhere around 16000-17000 crores with a debt equity ratio of 70:30.

The coal mine in Jharkhand is estimated to have 972 million tones of coal reserves which is 86% more than what is required for the plan and will help the project all the more. Reliance Power will need to dig 2 tones of earth to mine out 1 tone of coal.

An I-sec report recently said that any tariff of above 1.70 per unit will be a profitable bid which will also be helped by low input costs.

“We expect the contract to be signed in a month,” the PFC official said. The bids were started by a high-level committee inclusive of representatives from the governments of Bihar and Jharkhand

Once the results are out officially the Reliance Power will be officially making use of the services provided by the Jharkhand Integrated Power limited, as they will be equipped with special purpose vehicle for the Tilaiya project.

The government intended to complete the bidding of Tilaiya UMPP project before June 2007 and give away 5 other UMPP’s over the next few months which could be delayed now due to issues like establishment of an appropriate site, access to water resource and other mandatory clearances.

India needs to spend $600 billion on adding capacity to meet electricity demand, which may triple to 335,000 megawatts by 2017 if the country’s economy maintains its current pace of growth, McKinsey & Co. said in June 2008.