Govt issues oil bonds worth Rs 5,763cr

In a relief to oil companies, the government today issued oil bonds worth Rs 5,763 crore carrying an interest rate of 7% with 7-year maturity.

The bonds were issued to oil companies in lieu of the residual claims of the erstwhile oil pool account, which ceased to exist from April 2002, official sources said.

The government had made a provision of Rs 5,000 crore in the first batch of supplementary demands for grants passed by the Parliament in the just-concluded monsoon session.

While IOC will get bonds worth Rs 2,320 crore, the remaining is split almost equally between BPCL and HPCL.

These bonds are different from the proposal to issue Rs 10,000-12,000 crore oil bonds to compensate oil firms for selling LPG and kerosene below cost.

Finance minister P Chidambaram had said yesterday that the bonds were being worked out, and would be issued only after the Parliamentary approval, which could be secured only after the third week of Novermber.