The Hindu Business Line : GEB agrees to pay Rs 84-cr dues to ONGC

ONGC has finally made headway in recovering its dues from six State public sector undertakings and one municipal body in Gujarat. The dues have accumulated on account of supply of natural gas between 1982 and 1987 when gas marketing was directly handled by ONGC.

Informed sources in ONGC told Business Line that the Gujarat Electricity Board (GEB), which was one of the major defaulters, has agreed to pay Rs 84 crore, against the principal due in two instalments. "The first instalment was received on October 31 and the second one is due on November 30."

Apart from GEB, the others are Iffco, Heavy Water Project, Baroda Municipal Corporation, Gujarat State Finance Corporation (GSFC), Gujarat Narmada Fertiliser Corporation (GNFC) and Gujarat Industrial Development Corporation (GIDC). The accumulated principal default was close to Rs 800 crore which has inflated to over Rs 6,000 crore as on date after being charged with compound interest.

Describing the GEB payment as a major breakthrough achieved through prolonged persuasion, ONGC sources said that the company is currently negotiating with other defaulters to recover most of the principal dues. "We expect the others to follow the GEB way sooner or later."

It may be mentioned that recovery of dues had resulted in a war of words between ONGC and the GAIL in May-June this year. ONGC had threatened to snap supplies to GAIL allegedly for the latter's failure to discontinue supplies to the seven defaulting companies. ONGC had also wanted GAIL to enter into a detailed gas sales agreement (GSA), which is now being examined by the Union Petroleum and Natural Gas Ministry.

The Ministry, in order to help the process of mediation between the two majors, has formed a separate committee. Apart from mediating the row between the two hydrocarbon majors, the committee had also discussed ways and means for recovery of ONGC's dues.

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