Govt may revise ONGC's subsidy-sharing structure - Livemint

A file photo of oil minister Dharmendra Pradhan. Pradhan did not give details in a written statement while responding to a lawmaker’s query. Photo: HT

Mumbai: The government is considering reworking the subsidy-sharing formula for Oil and Natural Gas Corp. Ltd (ONGC ), oil minister Dharmendra Pradhan said on Wednesday, in a bid to lower its discount burden and boost the state-run oil company’s profits.

Pradhan did not give details in a written statement while responding to a lawmaker’s query.

The country’s largest oil and gas explorer, nearly 69% owned by the government, has seen profits decline due to the sale of crude oil to state-run refiners at discounted rates.

India does not regulate prices of petrol and diesel any longer, but state-owned companies are forced to discount prices of other common fuels such as kerosene and cooking gas to keep a lid on retail prices.

Any move to lessen its discount burden will be favoured by investors as the government plans to sell a 5% stake, worth about $2.5 billion, in ONGC as part of its divestment programme.

Shares in ONGC ended 3% higher at Rs.371.45, while the broader Nifty rose 0.15%. Reuters