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Assam gets Rs 1449 crore as crude oil royalty at pre-discounted price

| | Aug 05, 2016, at 12:43 am
Guwahati, Aug 4 (IBNS): Fulfilling the demands of the people of Assam, the Centre on Thursday facilitated the release of crude oil royalty at pre-discounted price when Oil India Limited and Oil and Natural Gas Corporation Limited handed over two cheques worth Rs. 1449.88 crore to Assam Chief Minister Sarbananda Sonowal at a function held in New Delhi's Assam Bhawan.
It may be mentioned that with the payment of differential royalty by OIL and ONGC, Assam has been entitled to crude oil royalty at pre-discounted price similar to Gujarat with effect from February 1, 2014.
 
The amount paid by OIL is Rs. 1149.24 crore and the amount paid by ONGC is Rs 300.64 crore.
         
Speaking on the occasion, Assam CM Sarbananda Sonowal thanked the Prime Minister who took the initiative of paying the oil royalty at pre-discounted price to Assam.
 
He also thanked the Union Minister of State for Petroleum and Natural Gas and oil companies for paying the royalty at one go.
 
Stating that the people of Assam are going through difficult times because of the recent waves of flood which affected 28 districts, Sonowal said that the royalty thus received can be used for the rehabilitation of the flood affected people.
 
He also asked the oil companies to look for ways and means to increase production because henceforth the progress of Assam will be intrinsically associated with oil production.
         
Union Minister of State for Petroleum and Natural Gas Dharmendra Pradhan said that effective from 2008-09, the royalty to the State Governments including Assam was being paid at post-discounted price which he termed as ‘grave injustice to the people of Assam.’
 
To remove the disparity being perpetrated to the State Governments, his ministry under the directive of the Prime Minister took the initiative and facilitated the release of oil royalty at pre-discounted price.
         
It may be mentioned that as per statutory provisions, royalty on production of crude oil in Assam, is paid by ONGC and OIL to the State Government.
 
Effective from 2008-09, the royalty to all State Governments including Assam was being paid on post discounted price of crude oil realized by ONGC and OIL from the Public Sector Marketing Companies.
 
However, in view of the litigation arising out of the loss of royalty to the State Governments due to discounts being provided by the ONGC and OIL to Public Sector Oil Marketing Companies and the decision of the Supreme Court dated February 13, 2014, the Ministry of Petroleum and Natural Gas decided to pay oil royalty to oil producing States at pre-discounted price.
         
 
(Reporting by Hemanta Kumar Nath)
 
#Assam #Crude oil royalty #Pre-discounted price #ONGC #Oil #Sarbananda Sonowal

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