Seeks deferred payments for domestic purchases, dollar window.
The Union petroleum ministry has proposed a 44 per cent increase in prices of natural gas sold under the administered price mechanism by state-owned Oil & Natural Gas Corporation and Oil India Ltd.
The subsidy burden of upstream oil companies, Oil and Natural Gas Corporation and Oil India Ltd, have risen 42 per cent in a single quarter.
Oil ministry had previously proposed a 30 per cent hike in price of gas produced by Oil and Natural Gas Corporation and Oil India Ltd to $2.3 per mmBtu but finance ministry wants these rates to be brought on par with RIL, sources in the know of the development said.
An Empowered Group of Ministers headed by Finance Minister P Chidambaram had on February 28 decided to sell the stake in IOC, the nation's largest oil firm, at a discount of 10 per cent through an off-market deal.
The Oil Ministry has fixed the subsidy payout by upstream firms like Oil and Natural Gas Corporation and Oil India Ltd at Rs 15,546.65 crore (Rs 155.46 billion) for the April-June quarter.
The world's fourth-biggest oil and gas consumer imports nearly three-quarters of its energy requirements
Analysts cut upstream firms' FY15 earnings estimates, while raising those for GAIL and Gujarat Gas.
As per the current market price, the government is expected to fetch Rs 5,300 crore (Rs 53 billion) by selling 10 per cent equity or 24.27 crore (242.7 million) shares at discounted price to Oil and Natural Gas Corporation and Oil India Ltd.
On Thursday, Oil Minister Dharmendra Pradhan had stated that the government was reworking the subsidy-sharing formula.
Making sense of the international crude market is incredibly hard.
The FinMin will pay Rs 5,324 crore (Rs 53.24 billion) for Jan-March.
Cabinet may tweak Rangarajan formula; new price may be further delayed.
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With Oil Ministry continuing to be opposed to selling IOC shares on stock market like other disinvestments, an Empowered Group of Ministers headed by Finance Minister P Chidambaram today decided to sell 24.27 crore shares or 10 per cent government stake in the company to Oil and Natural Gas Corporation and Oil India Ltd.
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