Naik assures excise relief package for Assam refineries

Jyoti Mukul

Guwahati, Jan 3: Union petroleum minister Ram Naik indicated on Thursday that the Centre will soon announce a package for Assam relating to central excise duty exemption for its three refineries and increase in royalty on crude to the state.

He was speaking at the inauguration of the country’s first ISO SIV unit for production of lead-free petrol and paraffins at the Guwahati refinery.

Reacting to a demand of the Assam government for increase in royalty on crude and increasing the production at Guwahati refinery, the minister assured appropriate action and said that he will announce a decision on Friday at Digboi.

The minister will be inaugurating the centenary celebration of the Digboi refinery on Friday. In his address, Assam chief minister Tarun Gogoi asked the central government to extend excise duty relaxation to Guwahati, Digboi and Bongaigaon refineries of the Indian Oil Corporation.

The only refinery in Assam to already have the exemption is the Bharat Petroleum’s Numaligarh Refinery. Mr Gogoi also called upon the Union minister to increase production at the Guwahati refinery which is the oldest public sector refinery in the country.

At present, the refinery, which has an installed capacity of 1 million tonne per annum, has a capacity utilisation of about 0.750 mtpa. A similiar demand was also made by the employees of the refinery who wanted the capacity to be raised to 3 mtpa. However, an Indian Oil Corporation official said that the reason for under utilisation of the refinery was the low production of Assam crude.

The CM also demanded royalty hike on crude production to the states. At present, the Centre pays Rs 850 crore per million tonne to the states. Assam produces about 5.2 mt of crude per annum and million cubic metre per day of natural gas. The ISO SIV unit at the Guwahati refinery, has been built at a cost of Rs 60 crore.