New Delhi: Flagship Explorer ONGC Chairman Alka Mittal on Monday said it does not see the Union government imposing an unexpected tax – similar to the measure announced by the UK government last week – to tap into part of the record profit made by the company due to the rise in global prices.
“We have not received any signal from the government on this. Rather, the government is asking us to be aggressive on spending on exploration to increase domestic production and cut import dependence. I don’t think they (government) are doing this. Will talk about (windfall tax),” Mittal said.
The government last week cut excise duty on petrol and diesel to reduce pump prices. It said the move would cost the exchequer Rs 1 lakh crore per year in tax revenue, leading to unexpected tax buzz in industry circles.
Mittal is the second chief public sector investigator after Oil India Limited Chairman SC Mishra has ruled out the possibility of unexpected tax at a time when the government is seeking foreign investment in exploration.
Company officials said 65-66 paise out of every rupee earned by the company goes to the government exchequer as tax. The rest is invested in finding new reserves and maintaining production from existing fields. The lack of such investment would hurt future production and hamper efforts to reduce the country’s dependence on imports by increasing domestic production.
Mittal said ONGC is spending Rs 30,000-32,000 crore annually to sustain production from old fields and start production from new discoveries.
On the issue of the government considering selecting a person from the private sector as the next chairman of ONGC, Mittal said: “All I can say is that the best talent (of the company) in the upstream sector is available on the board. ”
On the government asking ONGC to acquire part of Western companies that had announced plans to exit Russian oil projects, Mittal said there was no direction. “We are in touch with the (oil) ministry and are looking into the situation. There is nothing beyond that.”
“No one has made any offer to ONGC (on Russia), which is looking for globally prized assets at any point,” said a senior company official.
“We have not received any signal from the government on this. Rather, the government is asking us to be aggressive on spending on exploration to increase domestic production and cut import dependence. I don’t think they (government) are doing this. Will talk about (windfall tax),” Mittal said.
The government last week cut excise duty on petrol and diesel to reduce pump prices. It said the move would cost the exchequer Rs 1 lakh crore per year in tax revenue, leading to unexpected tax buzz in industry circles.
Mittal is the second chief public sector investigator after Oil India Limited Chairman SC Mishra has ruled out the possibility of unexpected tax at a time when the government is seeking foreign investment in exploration.
Company officials said 65-66 paise out of every rupee earned by the company goes to the government exchequer as tax. The rest is invested in finding new reserves and maintaining production from existing fields. The lack of such investment would hurt future production and hamper efforts to reduce the country’s dependence on imports by increasing domestic production.
Mittal said ONGC is spending Rs 30,000-32,000 crore annually to sustain production from old fields and start production from new discoveries.
On the issue of the government considering selecting a person from the private sector as the next chairman of ONGC, Mittal said: “All I can say is that the best talent (of the company) in the upstream sector is available on the board. ”
On the government asking ONGC to acquire part of Western companies that had announced plans to exit Russian oil projects, Mittal said there was no direction. “We are in touch with the (oil) ministry and are looking into the situation. There is nothing beyond that.”
“No one has made any offer to ONGC (on Russia), which is looking for globally prized assets at any point,” said a senior company official.