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IOC claims of loss, Govt issues special bonds

By Staff
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New Delhi, Mar 24 (UNI) Close on the heels of the government's decision to issue special bonds to the countries's three oil marketing companies, India Oil Corporation (IOC) today claimed that it is set to lose Rs 5,000 crores this year.

IOC said that it was currently losing Rs 2.40 per litre on petrol and Rs 4.40 per litre on diesel as domestic fuel tariffs have not moved in tandem with hike in global prices.

Speaking on the sideline of India Oil and Gas Conference, IOC director, S V Narasimhan, said the company lost Rs 1,700 crores in revenue on sale of petrol, diesel, LPG and kerosene for the first three months of this year alone.

For the full year of 2005, the under-realisation is pegged at around Rs 23,000 crores.

After taking into account the discount given by oil producers, ONGC and GAIL and oil bonds issued by the government, the net revenue loss for IOC in fiscal 2006 would be about Rs 5,000 crores.

IOC was selling LPG at a loss of Rs 243 per cylinder and kerosene at a loss of Rs 13.10 per litre.

The Government announced the issue of Special Bonds to three oil marketing companies to compensate them for under-recoveries in their domestic LPG and Kerosene (PDS) operations during the current financial year.

An RBI release said the Special Bonds will be issued at par to Indian Oil Corporation Ltd (IOCL) for Rs 3,542.95 crore, Bharat Petroleum Corporation Ltd (BPCL) for Rs 1,062.31 crore and Hindusthan Petroleum Corporation Ltd (HPCL) for Rs 1,144.74 crore on March 23, 2006 (Thursday).

The investment in the Special Bonds will not be reckoned as an eligible investment for purpose of Statutory Liquidity Ratio (SLR).

The Special Bonds will be transferable and eligible for market ready forward transactions (Repo). The bonds, however, will not be an eligible underlying security for ready forward transactions (Repo/Reverse Repo) with the Reserve Bank of India.

UNI RT SR BD1817

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