ONGC to take Rs 2,500 crore hit in Q4 due to royalty payment made to Assam government


ONGC to take Rs 2,500 crore hit in Q4 due to royalty payment made to Assam government

The profits of state-run Oil and Natural Gas Corporation Ltd (ONGC) is likely to be hit in the fourth quarter of the current financial year as it will be take into account the Rs2,500 paid towards royalty to Assam government for the period February 2014 to June 2015. “Though the amount has already been paid, it was not accounted for, and will reflect in the fourth quarter of the financial year,” said an ONGC executive.

However, he said the company will not be affected in any way for the payments to be made by the central government to Gujarat and Assam governments towards royalty on crude for the period between 2008-1014. The centre has recently undertaken to pay ONGC’s outstanding liability of Rs 8,392 crore to Gujarat government in two installments – 15% in 2016-17 and 85% in 2017-18 towards differences in royalty of crude extracted. It has also agreed to pay ONGC’s and Oil India Ltd’s (OIL) royalty dues of over Rs 6,323 crore to the Assam government in three installments – 15% in 2016-17 and 45% in 2017-18 and 40% in 2018-19. While ONGC is liable to pay Rs 1,350 crore royalty dues to the north-east state, OIL is supposed to cough up Rs 4,973 crore.

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