Indian ministry seeks oil, gas tax breaks

June 23, 2008 at 7:16 PM

NEW DELHI, June 23 (UPI) -- India's Petroleum and Natural Gas Ministry has sought Premier Manmohan Singh's intervention on a tax break on oil and gas production.

Petroleum Minister Murli Deora, who apprehends a poor response to oil and gas blocks offered under new exploration licensing policy-VII, has petitioned Singh, urging him to ask the Finance Ministry to honor its commitment on tax breaks to both oil and gas production.

Bids for 57 areas on offer in the seventh round of auction under the New Exploration Licensing Policy are due June 30. The Finance Ministry has said seven-year tax holidays are only for crude oil production and natural gas producers cannot avail of the benefit.

"There will be no (more) postponement (of bid date). NELP-VII bids will be received on June 30,'' Petroleum Secretary M.S. Srinivasan told reporters. The dates for the bids for NELP-VII have been postponed a few times, and efforts were on to convince the Finance Ministry that oil and gas are produced from the same well and cannot be segregated for taxation purposes.

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