Oil marketing companies face Rs.2 lakh crore debt burden

April 21st, 2011 - 12:01 am ICT by IANS  

Gandhinagar, April 20 (IANS) Oil marketing companies (OMCs) in India face a debt burden of Rs.2 lakh crore in 2011-12 due to under-recoveries with global crude prices touching $120 a barrel and marketing restricted to government-controlled rates for diesel, kerosene and cooking gas, a senior official said Wednesday.

According to S. Sundareshan, secretary at the ministry of petroleum and natural gas, the OMC’s debt burden was Rs.49,000 crore in 2006-07, which soared to Rs.70,000 crore and Rs.1 lakh crore in the next two fiscals.

In 2009-10, it was Rs.46,000 crore, which then increased to Rs.78,000 crore in 2010-11, he said.

Sundareshan was talking to mediapersons on the sidelines of the golden jubilee celebrations of the Ahmedabad Asset of the Oil and Natural Gas Corporation (ONGC) here Wednesday.

“The staggering hike in global crude prices is taking the projection to around Rs.2 lakh crore this year,” he said, pointing out that the matter is proposed to be taken up with the finance ministry at the highest level.

Sundareshan said that the private and public sectors have together invested $12 billion to develop oil and gas fields and an investment of Rs.65,000 crore is on the anvil over the next three years.

It will take the country’s oil refining capacity from 188 million tones per annum (MTPA) to 240 MTPA, he said.

This is around 90 MTPA more than the country’s annual consumption, according to the official.

Earlier, he said at the function that the country plans to increase export of petroleum products from the current 40 million tonnes to 90 million tonnes in the next three years.

The ONGC Videsh Limited (OVL) has invested $13 billion abroad so far, which is the highest investment by the Indian private or public sector out of the country, he added.

According to him, the OVL, with 34 assets in 15 countries and nine under production, was accounting for the equivalent of 20 percent of India’s domestic production.

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