Reliance Industries is known to have one of the smartest management teams in the country.The Reliance Group led by Mukesh Ambani is well connected with proven record in executing huge projects in the Oil and Gas Arena.However outside of their core competence,the Group has suffered.Its Retail Entry has not been much of a success despite big bucks being poured in the last 3-4 years.It entry into marketing of oil based fuels has also meandered without going anywhere.Now the Reliance Group has announced an entry into the Hotels Sector by acquiring a 14% stake in East India Hotels at a significant premium over the market price from the promoter Group.This ~$220 million investment is totally unrelated to Reliance’s activities and make no strategic sense.
Reliance’s Strategy in Shale Gas makes a lot of sense.The Technology is but new and unproven on a long time scale.There have been concerns about the environment impact of Shale Gas Extraction.Also low Gas Prices due to the GFC has made the industry growth slowdown.This is a good time to buy Shale Gas Assets relatively cheaply as Economic Recovery will again see Fossil Fuel Prices heading up.
Only communities adjacent to the rivers can use this water.An Environmental Group has also accused the state EPA of colluding with these corporate interests.This may lead to huge lawsuits against these companies and force the Boom to a halt.Shale Gas is supposed to be the new energy panacea as the deposits can meet US energy needs for 20 years.However like other fossil fuels it will deplete leaving behind a legacy of ecological degradation and destruction.
Solar Energy in India has the potential to be one of the biggest opportunities in the Energy Sector in the 21st Century.The government’s strong backing through JNNSM and India’s favorable location for Solar Energy is a win-win combination.This coupled with India’s huge energy deficit and scorching growth makes it a no-brainer investment.A number of Indian [...]
Shale Gas is the newest Fossil Fuel Technology which would greatly help extend the world’s fast depleting oil and gas reserves.Shale gas has boomed in the US recently with improvements in hydraulic technology.Shale Gas is a “unconventional” Gas form like coalbed methane which was not usually available in commercial quantities.However the ability to fracture shale [...]
The Indian Government failed to pass a law reforming the structure of state subsidies to the Oil sector .The Meeting between a empowered committee of Indian ministers was expected to loosen the control over prices of petrol,diesel and cooking gas.However the Government failed to make any headway citing high inflation as a reason to delay [...]