Centre to release Rs 3,000 cr more to PSU oil cos

The Finance Ministry has released an additional Rs 3,000 crore subsidies to state-owned oil marketing companies, Petroleum Secretary S Sundareshan said here on Saturday. With of this additional cash payment, the three state-owned OMCs—IOC, HPCL, BPCL— will get a total of Rs 13,000 crore in cash in the current financial year to make up part of   revenue loss.

These three oil marketing companies  are estimated to incur revenue loss of Rs 31,367 crore for selling three mass-consumed petroleum products—diesel, LPG and kerosene, in the first six months of the current fiscal. Petroleum Minister Murli Deora, on Friday met Finance Minister Pranab Mukherjee seeking hike in cash compensation for state-run oil companies.

Revenue loss

The Petroleum Ministry has been pleading with the Finance Ministry to make up for 50 per cent of the revenue loss. Of the projected revenue loss of nearly Rs 32,000 crore, upstream oil and gas exploration firms like ONGC, Gail India and Oil India will make up for Rs 10,456 crore and Rs 10,000 crore had previously been committed by the government by way of cash compensation. The remaining part of revenue losses is supposed to be absorbed by the state-owned OMCs.