Govt to consider Draft Refinery Policy Tomorrow

January 12, 2022

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The Cabinet Committee on Energy (CCoE) will discuss the Revised draft policy of Oil Refinery Sector at its meeting tomorrow in 2021.

This will be in addition to the revised Debt Management Plan. The meeting will be chaired by the Minister of Planning, Development and Special Initiatives.

According to the draft new refining policy for 2021, the new legislation aims to extend the tax exemptions under section 126B of the Finance Bill 2021-22 until December 31, 2022 in order to obtain government approval for the construction of new deep processing plants based on existing refineries. factories. Completion date 31.12.2021.

The government has already withdrawn the Sales tax on imports of Crude petroleum products, which was originally part of this policy.

It also proposes that additional income from tariff protection for the sustainability of the downstream sector is up to 30% of the project cost, and refineries add debt / equity (at least 70%) to the remaining project costs on their own balance sheet. Leaves. 40% customs protection was previously planned.

In practice, efforts will also be made to improve the SRA mechanism to enable upgrades / upgrades without withdrawing funds from the SRA prior to the award of EPC (design, procurement and build).