India’s top oil and gas producer ONGC has sent an SOS to the government seeking a cut in taxes as well as being granted pricing and marketing freedom for gas to help it weather the slump in prices that has made sustaining operations difficult and may force a cut in investments.
The slump in international oil prices to low-20s (USD/barrel) and natural gas prices falling to a decade low of USD 2.39 per million British thermal unit is threatening to push the company into making cash-losses on a monthly basis, sources with direct knowledge of the development said.
While the gas price is way below the cost of production, high tax incidence is resulting in cash losses even on crude oil output.
