BackOil India, ONGC pay Rs1,450 crore royalty dues to Assam
Oil India paid Rs1,149.24 crore while ONGC paid Rs300.64 crore to Assam CM Sarbananda Sonowal as royalty dues on crude oil mined in the state
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New Delhi: State-owned oil producers Oil India Ltd and Oil and Natural Gas Corp. (ONGC) Ltd on Thursday paid a total of ₹ 1,450 crore to the Assam government as royalty dues on crude oil mined in the state.
Oil India paid ₹ 1,149.24 crore while ONGC paid ₹ 300.64 crore to Assam chief minister Sarbananda Sonowal in the presence of petroleum and natural gas minister Dharmendra Pradhan.
Pradhan said the payment was the responsibility of the national oil companies at a time when Assam was reeling from floods.
The dues arose from the fact that from 2008-09, royalty to all state governments including Assam was paid on the basis of the price realised by crude oil producers after the discounts granted to refiners as part of the oil subsidy regime, which impacted the revenues of producing states Assam and Gujarat. States insisted that royalty ought to be computed on the basis of the pre-discount price.
Gujarat secured a favourable court order in November 2013 but ONGC challenged it in the Supreme Court which asked the company to pay royalty to Gujarat at pre-discount price during pendency of the petition. Companies have now decided to pay royalty to Assam as well at the pre-discounted rates for a two-year period starting 1 February 2014. Payment of dues for the earlier period remains sub-judice.
Sonowal thanked the companies for paying dues in single instalment. “Some parts of the state are under water. The state is going through a very difficult time. This money will be well utilised for the people of Assam," said the chief minister.
“Gross injustice was done to Assam in the payment of royalty and today, we are here to rectify that... Natural resources of a place belong to the people living there and, hence, it was proper that full royalty should be paid to Assam for the oil explored there," Pradhan said.
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