Oil Ministry benevolent towards oil companies

Oil exploration companies could be smiling after the Budget. That's because the finance ministry could give E&P and pipeline businesses the 'infrastructure' status, reports CNBC-TV18.

Oil ministry sources say that the finance ministry seems inclined to give exploration a boost, and an announcement to this effect could be made in the Budget.

The oil ministry has also asked that GAIL's tax holiday under section 80-1, be extended for the next seven years and wants service tax on E&P, LPG and kerosene to be eliminated.

For companies like ONGC, the subsidy burden may become less painful. That's because the oil ministry has asked that discounts given to oil marketing companies by ONGC be recognized as legitimate discounts.

The ministry also wants central sales tax on all petroleum products to be eliminated.