RIL may be keen to resolve the cost recovery issue in its KG-D6 block through arbitration, but the actual proceedings may begin only after a month or longer. The petroleum ministry is in no hurry to reply to the arbitration notice sent by RIL earlier this week. It will discuss the issue with the law ministry whose opinion on cost recovery lies at the root of RIL action. Petroleum secretary G C Chaturvedi said the arbitration notice grants a time of up to a month to respond and there was no hurry. He said they were studying the notice and the law ministry’s opinion on restricting cost recovery.Add a comment
At a time when the government is arguing that "under-recoveries" for oil companies is forcing upward revision in petrol prices, its own coffers have seen windfall gains from taxes on high prices. Indirect taxes on petroleum fetched the exchequer Rs1trn in 2010-11, a jump of 43% or over Rs300bn from the previous year. That's not all.
The government’s earnings from dividends and royalty payouts as well as profit from private oil contractors, was a sizeable Rs200bn in FY11. Also, the rise in dividend payout of 13% in 2010-11 by the state-controlled oil companies over the previous year reveals a much better performance than most other corporate houses, particularly in a year when the industry has been going through global financial turmoil and slowdown.Add a comment