Govt waives customs duty on goods for idle fields of ONGC, OIL

January 8, 2016

The government has waived customs duty on import of goods for producing oil and gas from 69 idle fields of ONGC and Oil India Ltd that will be auctioned this year. In a notification, the Revenue Department said ‘nil’ customs duty will apply to goods imported “in connection with petroleum operations undertaken under specified contracts under the Marginal Field Policy (MFP)”. The policy provides for a single licence to be bid out to operators to explore and extract all forms of hydrocarbon resources including conventional oil and gas as well as unconventional resources like coal-bed methane (CBM), shale gas or oil and gas hydrates.
The Union Cabinet had on September 2 last year approved MFP to bring idle fields of ONGC and OIL to production at the earliest so as to augment domestic production of oil and gas.
ONGC and OIL could not monetise the fields for years due to various reasons such as isolated locations, small size, prohibitive development costs, technological constraints and unfavourable fiscal regime.

Posted in Gas and Oil by admin

Leave a Reply

Your email address will not be published. Required fields are marked *