India may hike crude oil taxes to finance storage

March 4th, 2008 - 7:07 pm ICT by admin  

New Delhi, March 4 (IANS) The government might increase cess and duty on crude oil to raise money to fill the 5 million metric tonne (MMT) capacity strategic crude oil reserve storages, Minister of State for Petroleum and Natural Gas Dinsha Patel said here Tuesday. The government is setting up storage capacities at Visakhapatnam in Andhra Pradesh and Mangalore and Padur near Udipi in Karnataka at an estimated cost of Rs.23.97 billion to create strategic crude oil reserves to meet emergency situations like disruption in imported crude supply.

“While oil industry development board is financing construction of strategic storage, the government could consider a temporary increase in the cess on domestic crude and customs duty on imported crude to meet the cost of filling crude,” the minister said.

“While Vizag (Visakhapatnam) is proposed to have 1 MMT crude storage capacity, Mangalore and Padur storages will have capacities of 1.5 MMT and 2.5 MMT, respectively,” the minister said.

“The Padur storage is expected to be commissioned by December 2011, followed by completion of Vizag and Mangalore storages in January and July of 2011,” Patel informed the Rajya Sabha, the upper house of Indian parliament.

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