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New Delhi, March 28 Government on Friday issued oil bonds worth Rs 9,296.92 crore in order to compensate public-sector oil marketing companies for their under recoveries.

According to an official release, the Finance Ministry has announced the issuance of ‘8.40 per cent Oil Marketing Companies’ Government of India Special Bonds, 2025’ for Rs 9,296.92 crore (nominal).

The Special Bonds are being issued to four oil marketing companies as compensation towards estimated under-recoveries on account of sale of sensitive petroleum products during the current financial year (Rs 9,076.41 crore) and settlement of contingent liabilities.

The break up is: Oil and Natural Gas Corporation (Rs 197.37 crore) and Indian Oil Corporation (Rs 23.14 crore) pertaining to the administered price mechanism (APM) period, it said. The Special Bonds are being issued at par to IOC for Rs 5,121.62 crore, Bharat Petroleum Corporation Ltd (BPCL) for Rs 2,078.92 crore, HPCL for Rs 1,899.01 crore and Oil and Natural Gas Corporation Ltd for Rs 197.37 crore on March 28, 2008 (Friday). The bonds do not have an SLR status. The release said: The investment in the Special Bonds by the banks and insurance companies will not be reckoned as an eligible investment in Government securities for their statutory requirements.

More Stories on : Petroleum | Corporate Bonds

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