The annual under-recoveries of state-run oil marketing companies have been estimated at Rs 1.1 lakh crore, the government told the Lok Sabha on Thursday.
"The annual under-recoveries of the public-sector oil marketing companies (OMCs) on sale of four sensitive petroleum products -- petrol, diesel, PDS kerosene and domestic LPG -- have been estimated to be around Rs 1,10,000 crore," Minister of State for Petroleum Jitin Prasada said during Question Hour.
The under-recoveries have been calculated assuming an average crude oil price at $85 per barrel and at Rupee-Dollar exchange rate of Rs 45 per dollar for the year 2010-2011, he said. Prasada said government has recently constituted an Empowered Group of Ministers to consider issues relating to the under-recoveries of the OMCs in light of recommendations of the Kirit Parikh Committee report.
The committee was set up to suggest a viable and sustainable system of pricing of petroleum products and address the issues relating to under-recoveries of the OMCs. Prasada said that with regard to pricing of petroleum products it has been the endeavour of the government to ensure that the least burden is put on the consumers.
He pointed out that a subsidy of Rs 300 per cylinder has been extended by the government for domestic consumers. Replying to another question, Prasada said 26 allocations have already been made for coal bed methane while eight others were in the pipeline.
He said two million metric standard cubic meters per day (scmd) have been allocated for the small and medium enterprises sector from the KG D6.
The allocation has been made on fallback basis to City Gas Distribution entities for supply to their industrial and commercial customers whose total consumption of natural gas does not exceed 50,000 scmd.
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