BPCL gets Rs2,371 crore of Rs12,000 crore to OMCs

The Finance Ministry yesterday announced disbursement of Rs12,000-crore subsidy to oil marketing companies, of which Bharat Petroleum Corporation Limited (BPCL) received Rs2,371 crore, as confirmed by S K Joshi director of finance, BPCL

The move comes close on the heels of oil secretary R S Pandey' statement on 14 January that state oil companies may be offered cash instead of oil bonds by way of compensation to make up for below market price sale of fuel.

According to Joshi, the company's total under-recovery stood at Rs10,000 crore but BPCL had received only Rs4,700 crore from the government and upstream companies.

He added the company would seek further compensation from the government and said there was a need for a government formula to bridge the gap.

Joshi said the total industry under-recoveries were at Rs45,000-47,000 crore, of which cooking fuel under-recoveries accounted for Rs31,000 crore.

''We have received a letter from the finance ministry, assuring a disbursement of Rs 12,000 crore in cash towards the underrecoveries of OMCs on sale of LPG and kerosene. This will help the oil marketing companies (OMCs) to announce better results for the previous quarter,'' Pandey said today.