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Under-Realisation to OMC’s on SKO (PDS), LPG(D), MS and HSD

Under-Realisation to OMC’s on SKO (PDS), LPG(D), MS and HSD. Presentation to Hon’ble Minister, Petroleum & Natural Gas and Panchayati Raj. Movements of Retail Selling Price. REVISION OF SKO/LPG PRICES SINCE 1.4.98. Comparative Position of FOB/Ex-Storage price.

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Under-Realisation to OMC’s on SKO (PDS), LPG(D), MS and HSD

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  1. Under-Realisation to OMC’s on SKO (PDS), LPG(D), MS and HSD Presentation to Hon’ble Minister, Petroleum & Natural Gas and Panchayati Raj

  2. Movements of Retail Selling Price • REVISION OF SKO/LPG PRICES SINCE 1.4.98

  3. Comparative Position of FOB/Ex-Storage price

  4. Movements of Retail Selling Price

  5. Comparative Position of FOB / Ex-Storage / Retail price

  6. Cross Subsidy to Oil Pool Account from ONGC/Oil • During 1999-2000, Cap of Rs. 5570 per MT (Approx. 16 $/BBL) for ONGC/Oil was fixed by Govt. • Inflow into Oil Pool from Cross Subsidy on Crude Oil is given below: Rs. Crore

  7. Comparative Position During APM Period • Under-Recovery on SKO & LPG Compensated from Oil Pool • Oil Bonds Issued to OMCs in March 2002 for Rs. 7775 Crore • Balance Dues Rs. 3108 Crore Already Accounted by OMCs – Bonds Yet to be Issued

  8. Scenario in 2002-03 • SKO and LPG Prices not Revised • Subsidy Compensation as per Frozen March 2002 Prices • No Sharing by ONGC / GAIL • NET Under-Recovery on SKO & LPG – Rs. 5327 Crore.

  9. Scenario in 2003-04 • SKO and LPG Prices not Revised • Subsidy Compensation Reduced to 2/3rd of 2002-03 • Net Under-Recovery to be Shared – • 1/3rd – Cross Subsidisation from MS & HSD • Balance to be Shared Equally by ONGC/GAIL and OMCs

  10. Scenario in 2003-04 • Actual Sharing as Follows:

  11. Current Scenario – 2004-05 • Price Control on MS & HSD upto 15.6.2004 • Price Revision only on 16.6.2004 and 1.8.2004 • No Revision in SKO Price • LPG Price Revised only on 16.6.2004 by Rs. 20 Per Cly. • Subsidy Compensation Reducted to 1/3rd of 2002-03 • Increase in Ms & HSD Retail Price at Delhi

  12. Current Scenario – 2004-05 Under-Recoveries on MS, HSD, SKO & LPG (Rs. Crore)

  13. Increasing Revenue Generation - Upstream ($ Per BBL) • Compensation to Upstream on Actual IPP • OMCs not Correspondingly Compensated

  14. Pricing As Per Band Mechanism MS – RSP 1st F/N Sept. ’04 (Rs. Per Ltr.)

  15. Pricing As Per Band Mechanism HSD - RSP 1st F/N Sept. ’04 (Rs. Per Ltr.)

  16. Under-Realisation Per Selling Unit (Rs. Per Ltr.)

  17. Current Scenario – 2004 - 05 • Lower profitability of OMCs Due to • Increasing Trend in Under-Recoveries • Reduced Refining Margins

  18. Impact of Lower Profitability • Lower Pay-Out Ratio of Dividend • Lower Payment of Income Tax • Erosion in Market Capitalisation

  19. Proposal for Equitable Sharing of Under-Recoveries • Subsidy Compensation to be Increased to 60% • Cap on Crude Oil/LPG Price payable to ONGC/Oil/GAIL • Sharing of 50% Under-Recovery by ONGC/GAIL/OIL

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