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ONGC suffers annual loss of Rs700 cr on sale of gas

ONGC suffers annual loss of Rs700 cr on sale of gas
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First Published: Mon, Apr 14 2008. 05 38 PM IST
Updated: Mon, Apr 14 2008. 05 38 PM IST
PTI
New Delhi: Oil and Natural Gas Corp (ONGC) today said it was making an annual loss of about Rs700 crore on sale of gas at administered prices and hoped the government will soon decide on hiking the fuel price.
“We currently get a price equivalent to $1.95 per million British thermal unit (mBtu) but we break-even is at $2.5 per mBtu,” RS Sharma, ONGC chairman and managing director told reporters on the sidelines of the 5th Asia Gas Partnership Summit here.
He said the present price of Rs3.2 per cubic metres that ONGC gets for gas produced from fields given to it on nomination basis, was not sustainable.The hike suggested by Tariff Commission to Rs3.6 per cubic meters would only help ONGC break-even.
For gas from new fields, like the deepsea gas field ONGC has made in KG basin off the Andhra coast, Sharma sought market price.“We hope that the Cabinet will soon decide on raising APM price of our gas,” he said.
APM or administered price is referred to for gas produced by ONGC and OIL from oil fields given to them on nomination basis. Price of about 80% of gas produced by ONGC is regulated by the Government.
Petroleum Ministry had in January recommended to the Cabinet a 16% increase in price of gas produced by ONGC and Oil India Ltd but with inflation at over-three year high, a decision has been put on hold.
“In 2006-07, we made a net loss of Rs600 crore on natural gas sale. The figures for 2007-08 have not been calculated but it is about Rs700 crore,” he said while pitching for an immediate increase in natural gas prices.
IOC losing Rs320 cr per day on fuel sales
Indian Oil Corporation (IOC) today said it is losing Rs320 crore per day on fuel sales and if the situation continues for more than a year, its project may get impacted.
“Right now we are able to manage, but if this continues for one more year, we will see investment in our project getting impacted,” IOC Chairman S Behuria told reporters here.
The company, he said, is losing Rs320 crore per day on sale of petrol, diesel, LPG and kerosene.
“Our borrowings as of 31March, 2008 have risen to Rs34,000 crore,” he said. IOC plans to invest Rs7,500 crore in refinery and pipeline projects in 2008-09.
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First Published: Mon, Apr 14 2008. 05 38 PM IST