New Delhi, Aug. 20: Higher crude prices have resulted in increased royalty earnings for oil producing states.

According to official figures, oil companies forked out Rs 3,206 crore as royalty for oil and gas to state governments for the financial year ended March 31, 2006. This was 44 per cent higher than the Rs 2,224.93 crore doled out in 2004-05.

The royalty payments are expected to rise further during 2006-07 as crude prices have been shooting up. However, since downstream oil companies have to be given hefty discounts to compensate for the subsidy on LPG and kerosene, the states will not get the full benefit of the increase in crude prices.

Gujarat received the highest royalty of Rs 1,707.60 crore during 2005-06, a jump of 51 per cent over the previous year.

Assam, which is the second largest oil producing state, received Rs 1,207.47 crore as royalty, which was 35 per cent higher than the Rs 894.08 crore it got in 2004-05.

The higher increase for Gujarat can be attributed to companies producing more oil in the state compared with the stagnant production in Assam where poor law and order situation hampers work.

Tamil Nadu and Andhra Pradesh, which produce relatively small quantities of oil, received Rs 142.83 crore and Rs 110.45 crore respectively. The two southern states were followed by Arunachal Pradesh Tripura with receipts of Rs 27.7 crore and Rs 7.39 crore respectively.

According to ONGC sources, the import parity price of Indian crude during 2005-06 was at $59.65 per barrel. However, a discount of $17.32 per barrel was given to downstream oil companies to compensate them for subsidy on LPG and kerosene.

As a result, the net price realised by ONGC and OIL was $42.3 per barrel.

For the first quarter of the current fiscal (April-June), the import parity price of Indian crude has gone up to $71.39 per barrel. But ONGC and OIL have been asked to give a hefty discount of $26.39 per barrel as the losses of the downstream oil companies have mounted because domestic prices of petrol, diesel, LPG and kerosene have not been raised. As a result, the net price of the crude worked out to $45 per barrel.

The central government also loses out on royalty from the offshore oil and gas fields such as Mumbai High and Bassein, which produce most of the country's oil and gas. These fields do come under the territory of any particular state and their royalty goes to the central government.