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Tuesday 1 November 2011

Indian Energy Imports to Exceed $400b by 2020 Doubling GHG Emissions

Indian Energy Imports to Exceed $400b by 2020 Doubling GHG Emissions
Reading just two TNN stories it can be easily concluded Indian companies had invested or already committed to invest over $100b in Oil & Gas, Coal and Energy sector in foreign countries. Reliance Power, Adani Power, Lanco Infratech and GVK acquired Coal Mines having over 25.1 Billion Tones of coal reserves with 500m tones peak Coal Extractions annually – this doesn’t include other Indian power, power, steel, mining & oil & gas companies investing in foreign energy sector, so it can be concluded in all over $100b in foreign investment is already committed and $50b coming up this year.
Energy & Minerals resources acquired by Indian Companies in foreign countries could be worth $20,000b but India is Enslaved When Required to Import $400b Worth of Energy by 2020 and neglecting Indian economy.
In addition RIL alone is in the process of bidding Valero Energy for $27b that may eventually go up to $50b over and above its other foreign acquisitions. As per latest financial statement Valero Energy profit margin after tax is barely 1%. This adds up to over $150b.
But unlike State Owned Chinese Companies acquiring foreign energy & mining concessions Indian companies are privately owned who are neither committed to ship Coal and Oil & Gas to India nor profits in operations.
India is neglected in the process and virtually Promoting Loot –
1. There is little investment in developing Coal & Oil & Gas in India, 150 million tones of iron ore is/was being exported at mining cost of Rs.600 per tone – a tenth of export price.
2. By 2014 India is committed to Import 180 million tones of coal annually at landed and transport cost exceeding $150-$200 per tone, when mining cost of Coal in India is just $10 per tone to $20 per tone and all internal costs. This is Energy Loot by private companies – fuel cost per unit of electricity would go up from Rs.2 to Rs.5 from imported Coal. Against average realization of Rs.3 per unit new generation cost shall be Rs.9 per unit to over Rs.10 per unit and more due to inflation.
3. Private sector has invested $13b in adding just 13,000MW of Thermal Power in last six years and real investment in Oil & Gas is not even $5b since 1999 – 80% of new generation capacity is being contracted on Engineering Procurement & Construction basis to Chinese companies.
4. By 2020 India may be importing 500m tones of coal annually worth $100b and together with Oil & Gas energy imports may exceed $300b to $400b.
5. When Central & State owned Energy Companies are starved of resources over $150b already committed in foreign countries, India is depending on private companies to import Energy worth over $400b annually by 2020.
Private sector installed capacity Thermal Power in Jan2005 was 8998 MW that has gone up to 22747 MW or roughly 13,000 MW.

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