News Release Details
Refinery stocks get a big boost as oil zooms
Mumbai 12-Jul-2007
STOCKS of standalone oil refineries have been among the top performers on the stock market in the recent months. Chennai Petroleum and Reliance have seen their stock prices rise 50-60% since the beginning of the fiscal. One reason for the market's optimism is the high margins currently to make in the petroleum refining business. The gross refining margin difference in the price of crude oil and finished products is close to $9/barrel for Indian Oil the country's largest refiner. IndianOil 's margins have ranged from $5-6/bbl in the recent years. There is a shortage of refineries that can process heavy and high sulphur crude oils, which account for a greater share of the global oil production. This shortage is expected to persist for longer than the earlier projections, which is. The other reason for bullish outlook on the sector. Many of the new refineries on the drawing board are getting delayed as contractors and equipment suppliers are not available. Those going forward are also witnessing cost over-runs. For instance, KNPC Kuwait's national oil company was planning a 31MT refinery at a cost of $6 billion. As per news reports, this project has been delayed by a year and the projected cost has dobelled $$ billion. In South Korea S-Oil and Saudi Armaco have propend plans for a 24MT refinery, these delays have prompted many research houses to revise their estimates of how long the current industry upturn will last. Call, Apollo lyres sign green pact THE agreement between Gail India and Apollo Tyres for recovery of waste heat is an important step towards energy efficiency, with increasing concern related to energy scarcity and global warming. The project also offers significant cost saving through trade of greenhouse gas. The project would help Apollo Tyres generate energy equivalent to more dian 2.5 crore units of power or approximately Rs 10 crore saving on power and fuel bill. The agreement aims to generate steam from the exhaust gas coming out of gas turbine, which cannot be fully utilised. The steam can in turn be used as such for process requirement in manufacturing or used for generation of power. Expected investment for the projects fa around Rs 35 crore with a payback period of 2-3 years. Gail India has other locations also where there is significant potential to take up such project where it plans to invest about Rs 200 crore. Greenhouse gas reduction is gaining ground with greater concern related to global warming. The. Dean development mechanisms provide the firms, which install energy efficiency equipment to get the project approved, and trade the carbon credit generated. Market for Certified Emission Reduction (CERs) is still developing but there is potential to generate significant revenue through this trade. The rate has been as much as $20 per CER sometime back, which would mean revenue of around Rs 4 crore from this project. However, the rate is varying significantly and actual price would depend upon then prevailing condition.
Mumbai 12-Jul-2007
STOCKS of standalone oil refineries have been among the top performers on the stock market in the recent months. Chennai Petroleum and Reliance have seen their stock prices rise 50-60% since the beginning of the fiscal. One reason for the market's optimism is the high margins currently to make in the petroleum refining business. The gross refining margin difference in the price of crude oil and finished products is close to $9/barrel for Indian Oil the country's largest refiner. IndianOil 's margins have ranged from $5-6/bbl in the recent years. There is a shortage of refineries that can process heavy and high sulphur crude oils, which account for a greater share of the global oil production. This shortage is expected to persist for longer than the earlier projections, which is. The other reason for bullish outlook on the sector. Many of the new refineries on the drawing board are getting delayed as contractors and equipment suppliers are not available. Those going forward are also witnessing cost over-runs. For instance, KNPC Kuwait's national oil company was planning a 31MT refinery at a cost of $6 billion. As per news reports, this project has been delayed by a year and the projected cost has dobelled $$ billion. In South Korea S-Oil and Saudi Armaco have propend plans for a 24MT refinery, these delays have prompted many research houses to revise their estimates of how long the current industry upturn will last. Call, Apollo lyres sign green pact THE agreement between Gail India and Apollo Tyres for recovery of waste heat is an important step towards energy efficiency, with increasing concern related to energy scarcity and global warming. The project also offers significant cost saving through trade of greenhouse gas. The project would help Apollo Tyres generate energy equivalent to more dian 2.5 crore units of power or approximately Rs 10 crore saving on power and fuel bill. The agreement aims to generate steam from the exhaust gas coming out of gas turbine, which cannot be fully utilised. The steam can in turn be used as such for process requirement in manufacturing or used for generation of power. Expected investment for the projects fa around Rs 35 crore with a payback period of 2-3 years. Gail India has other locations also where there is significant potential to take up such project where it plans to invest about Rs 200 crore. Greenhouse gas reduction is gaining ground with greater concern related to global warming. The. Dean development mechanisms provide the firms, which install energy efficiency equipment to get the project approved, and trade the carbon credit generated. Market for Certified Emission Reduction (CERs) is still developing but there is potential to generate significant revenue through this trade. The rate has been as much as $20 per CER sometime back, which would mean revenue of around Rs 4 crore from this project. However, the rate is varying significantly and actual price would depend upon then prevailing condition.