Sop season

New Delhi, Oct. 30: State-run oil firms will receive an additional Rs 3,000 crore as subsidy from the government to meet the revenue losses during the first half of the fiscal.

“The ministry of finance has agreed to release an additional Rs 3,000 crore (as compensation for under-recoveries). This is a very, very good message for the divestment of IOC and ONGC,” petroleum secretary S. Sundareshan told reporters on the sidelines of an industry event.

The Rs 3000-crore grant is in addition to the Rs 10,000 crore given earlier, he said.

The government plans to divest 10 per cent in IOC, which will also issue a 10 per cent fresh equity in the follow-on public offer in January, and 5 per cent of its stake in ONGC in March.

Oil minister Murli Deora had yesterday met finance minister Pranab Mukherjee to seek a hike in cash compensation for state-run oil firms.

The oil ministry had been asking the finance ministry to make up for 50 per cent of the revenue loss as the retailers cannot absorb more than Rs 6,000-7,000 crore loss in the entire financial year.

The three firms lost Rs 31,367 crore in revenues during the April-September period on selling diesel, domestic LPG and kerosene below cost.

Gas pooling

The petroleum secretary said the government was likely to formulate a mechanism for pooled pricing of natural gas in the country in the next six to eight months to check the huge difference in prices between regions.