Editor's Desk - FreePress India

GAIL signs GSPA with Reliance Industries for KG Basin Gas – GAIL Under Loss

August 31, 2009 by Editor's Desk

Government owned-gas transmission and marketing major GAIL India, on Friday, signed a Gas Sales and Purchase Agreement (GSPA) with Mukesh Ambani-controlled Reliance Industries to source gas from the latter’s oil fields in the Krishna Godavari basin in the eastern offshore.

The agreement envisages purchase of 2.6 million standard cubic meters per day (mmscmd) of gas from RIL’s KG-D6 fields at government approved price of $4.2 per million British thermal unit (mBtu). Gas supplies are expected to begin from September 3, according to GAIL sources. However, in our opinion, the Government / GAIL should be entitles to the GAS at a much lower price of $2.4 per mBtu.

Indian Monsoon Failure – Kharif harvest set to decline 20%

August 28, 2009 by Editor's Desk

Poor rains are set to hit India’s farm output even as the government reiterates it had enough reserves to ensure food security. India’s finance minister Pranab Mukherjee said on Thursday that the country was likely to see 15-20% decline in summer (kharif) crop harvest due to the poor rains.

The minister said that about 252 out of India’s 626 districts had been declared drought impacted as a result of the weak southwest monsoon. Cumulative rainfall in the June-September monsoon season so far was about 26% below the long period average (LPA).

Infrastructure growth slows to 1.8% in July

August 26, 2009August 26, 2009 by Editor's Desk

India’s core sector growth has slowed down again in July after improving consistently through the first quarter of the current fiscal. The group of six infrastructure industries posted a poor growth of 1.8% in the month of July compared with 2.8% in May and 6.5% in June. Growth in the corresponding month last year was 5.1%.

Main culprits for pulling the growth down were crude and steel. Crude oil production dipped by 0.4% in July while steel output expanded by only 1.2% against 6% a year ago. On the other hand, coal output expanded by 9.7% against 5.5% last year, electricity by 3.3% compared with 4.5% and cement by 10.6% against 5.5% the year ago period.

Mukesh Ambani Reliance accepts Cost Escalation in KG Basin – Shady Government Deals

August 25, 2009August 25, 2009 by Editor's Desk

In a stunning admission, RIL has released defending the cost escalation of KG basin project.

As against the ADAG’s claim, RIL says the capital expenditure for the KG-D6 fields has increased from $2.47 billion in 2003 to $8.83 billion due to a 2.5 times increase in reserves, trebling of production facilities, doubling of peak production, hike in number of wells, field life and inflation in the equipment and services industry.

FIIs net sellers of Rs 438 cr (prov) in the cash on Thursday

August 21, 2009 by Editor's Desk

Foreign institutional investors (FIIs) were net sellers of Rs 438.19 crore (provisional) in the cash segment on Thursday, as per information posted on the BSE website. While FIIs made gross purchases of Rs 1,766.64 crore, their gross sales aggregated Rs 2,204.83 crore.

On the other hand, domestic institutional investors (DIIs) were net buyers of Rs 489.42 crore (provisional) on the same day. While DIIs made gross purchases of Rs 1,343.26 crore, their gross sales stood at Rs 853.84 crore.

Weak American jobs data pulls down copper prices

August 21, 2009August 21, 2009 by Editor's Desk

US copper ended lower, capping the longest slide in two months, after US jobless claims rose unexpectedly last week, igniting fresh concerns that the recession is damping demand for industrial metals.

The metal extended its fall after a report revealed Americans fell behind on their mortgage payments at a record pace in the second quarter, a sign that the housing market has yet to stabilize. Copper dropped for the fifth straight session.

Copper futures for December delivery lost 1.7 cents, or 0.6%, to $2.754 a pound on the Comex division of the New York Mercantile Exchange. The industrial metal has declined 6% since August 13.