Question : DECLINE IN REFUND OF STATE RUN OIL MARKETING COMPANIES

MINISTER OF THE STATE IN THE MINISTRY OF PETROLEUM AND NATURAL GAS (SHRI JITIN PRASADA)

(a)to(b): During the year 2009-10 (April-December 2009),the Pubic Sector Oil Marketing Companies (OMCs), viz., Indian Oil Corporation Limited, Hindustan Petroleum Corporation Limited and Bharat Petroleum Corporation Limited have incurred the following under-recoveries on the sale of PDS Kerosene and Domestic LPG:

Rs. crore
April-December 2009
PDS Kerosene	12,560
Domestic LPG	8,429
Total	20,989

The Government has been following a Burden Sharing Mechanism, to ensure that the burden of under-recoveries is equitably shared by all the stakeholders; namely the Government, the Public Sector Oil Companies and the consumers in the following manner:

# Government through issue of Oil Bonds/Cash Subsidy

# Domestic upstream oil companies through price discounts to OMCs

# OMCs to bear a portion of the under recoveries and

# Consumers to bear minimal price increases.

Under the abovesaid mechanism, Ministry of Finance have confirmed a budgetary support of Rs.12,000 crore as the share of the Government towards meeting the under-recoveries for the entire year 2009-10.

Ministry of Petroleum and Natural Gas is in constant touch with the Ministry of Finance for the grant of subsidy assistance for the OMCs’ under-recoveries on PDS Kerosene and Domestic LPG.