Gogoi urges PM for oil royalty at pre-discounted price

Guwahati:  Assam Chief Minister Tarun Gogoi on Monday requested Prime Minister Narendra Modi to ensure payment of oil royalty at prevailing market prices after the state government has incurred a loss of nearly Rs 10,000 crore since 2008 because of disbursement of oil royalty at highly discounted price to Central government’s PSUs.
Raising the issue of underpayment of royalty in a letter to the Prime Minister, Chief Minister Gogoi said, “A special category and resource-constrained State like Assam cannot afford such a huge loss of revenue. Oil producing States like Assam should not be denied the benefits of its natural resources and made to compensate for the under-recoveries of the Central oil marketing PSUs.”
Referring to the verdict by Gujarat High Court on a petition filed by the Government of Gujarat that royalty on crude oil be made on fair market price and not on discounted price as well as the Supreme Court order that royalty be made by ONGC to the same government on pre-discounted price of crude oil with effect from 1st February, 2014,  Gogoi said, “In view of the developments, I would request you to advise the Ministry of Petroleum and Natural Gas to give appropriate instructions to ONGC and OIL to pay royalty on crude oil at 20 per cent of the wellhead price, in addition to VAT at 5 per cent and other State taxes at pre-discounted price to Government of Assam with effect from 1st February, 2014.”
Gogoi also requested the Prime Minister for his kind intervention for withdrawal of the circular of the Ministry of Petroleum and Natural Gas issued on May 23, 2008 to facilitate the payment of arrear royalty and state taxes on crude oil to Assam and other oil producing States with retrospective effect from 2008-09. (UNI)