recession will worsen supply-side constraints that pushed prices up, says energy expert

The world is breathing easy, now that oil prices are below $40 a barrel, down sharply from $147 a barrel in June. But, in fact, the current financial crisis and recession could accentuate the severe supply-side constraints that drove up prices last year to record highs, cautions Mikkal Herberg, research director of the energy security programme at the National Bureau of Asian Research in Washington and a veteran strategist in the oil industry.

Coastal Energen's 1,200-mw power plant at Tuticorin in Tamil Nadu will see financial closure in two months, co-promoter Coal & Oil Group said.

Ahmed A R Buhari, founder president and chief executive officer of Coal & Oil Group, said a consortium of 19 banks, led by State Bank of India, has agreed to lend to the project. The first phase of the coal-fired thermal merchant power project, with a capacity of 1,200 mw, will need investments of Rs 4,500 crore, of which the debt component is Rs 3,450 crore. "The equity component of Rs 1,050 crore will come from accruals and investment from parent companies," Buhari said.

The Union Cabinet has cleared proposals to establish three petrochemicals hubs at Dahej in Gujarat, Haldia in West Bengal and Vishakhapatnam in Andhra Pradesh.

The government has been evaluating six sites for development as Petroleum, Chemicals and Petrochemical Investment Regions (PCPIRs) after the policy to build such regions was introduced in May 2007.

The proposed PCPIR would be a delineated investment region with an area of about 250 square kilometres earmarked for manufacturing facilities producing petroleum, chemical and petrochemical products - either for domestic consumption or for exports.

Tehran  - Iran will come up with new nuclear developments by the beginning of April this year, Iranian Vice-President Gholam-Reza Aqazadeh said Wednesday, indicating a probable increase of the number of centrifuges.

"We will have good nuclear news again on April 9," said Aqazadeh, also head of Iran's Atomic Energy Organization, in a news conference in Bushehr, southern Iran.

Vienna - Austrian oil and gas group OMV AG on Wednesday reported that its annual net income fell 17 per cent to 1.53 billion euros (1.95 billion dollars), with the company turning into the red in the fourth quarter.

The drop in net earnings came despite a 7 per cent rise in operating income to 2.34 billion euros.

Annual sales rose to 25.54 billion euros, an increase of 27 per cent, said OMV, the Central and South-eastern European market leader in refining and marketing.