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“We had sought Rs 19,620 crore as compensation but they (finance ministry) have agreed to give Rs 14,000 crore,” petroleum minister Murli Deora said. The three OMCs — IOC, HPCL and BPCL — lost Rs 31,621 crore on selling LPG and kerosene below market prices in 2009-10.
The three firms lost Rs 14,430 crore on selling petrol and diesel below market cost, which will be compensated by upstream companies — ONGC, Oil India and GAIL (India).
However, there is no indication of how the gap of another R 4,000-5,000 crore of under-recoveries will be bridged.
When contacted, SK Joshi, director (finance), BPCL, refused comment. “We have not received any communication from the government in this regard and we will have to see the figures before commenting,” Joshi said. The three OMCs will declare annual results for 2009-10 by month-end. Finance minister Pranab Mukherjee mooted the idea to release compensation in cash instead of bonds as was done earlier.
There is no clarity on sharing of under-recoveries in 2010-11. The prime minister last week constituted a ministerial panel to decide on recommendations by Kirit S Parikh committee.
The committee has recommended freeing petrol and diesel prices, and hiking kerosene by Rs 6 a litre and LPG cylinder by Rs 100. Petroleum ministry had proposed market-determined price for petrol and diesel and minimal hike in price of cooking gas and kerosene after reviewing Parikh’s report. But the reforms couldn’t be pursued due to the lack of political consensus between Congress and its allies.
At present, OMCs sell petrol at a loss of Rs 6.63 a litre, while diesel is sold at a loss of Rs 6.25 a litre. Kerosene is sold Rs 19.74 per litre less than the market price and every domestic LPG cylinder is sold at a loss of Rs 254.37.
 Limited.JPG)
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