IOC, BPCL, HPCL to get oil bonds worth Rs65,942 cr

IOC, BPCL, HPCL to get oil bonds worth Rs65,942 cr

New Delhi: Indian Oil (IOC), Bharat Petroleum (BPCL) and Hindustan Petroleum (HPCL) are likely to get oil bonds worth Rs65,942 crore this week to make up for half of their revenue loss on fuel sale during the first nine months of 2008.

“Parliament has already approved (issue of oil bonds). We expect Finance Ministry to intimate of the bonds anytime now," Petroleum Ministry Additional Secretary S Sundareshan said.

BPCL is to announce tomorrow its earnings in July-September quarter, while HPCL and IOC are to do so on Friday. Without the oil bonds, the three would post huge losses.

“Even with oil bonds, things are not going to be any better," he said.

The three firms would get Rs14,956.17 crore worth of oil bonds for selling petrol, diesel, domestic LPG and kerosene below cost in January-March quarter. They will get an additional Rs24,408 crore compensation for April-June quarter and the remaining will be for July-September quarter.

Government compensates half of the losses resulting from its dictate to oil companies to not to raise fuel prices in line with cost, through issue of oil bonds.

For 2007-08, the oil companies reported a total revenue loss of Rs70,579 crore of which Rs35,289.50 crore is to be compensated through oil bonds. The government has already issued, oil bonds worth Rs20,333.33 crore for April-December 2007 period.

IOC, BPCL and HPCL in April-September lost Rs92,853 crore on fuel sales (audited figures) and are projected to lose Rs1,47,486 crore in the full fiscal. Half of the projected revenue loss is to be compensated through oil bonds.

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