The Petroleum and Natural Gas Ministry has informed the Prime Minister’s Office (PMO) that it would not give go ahead to any approvals or permissions for Reliance Industries Ltd.’s flagship KG-D6 fields in view of its refusal to submit its accounts for Comptroller and Auditor General (CAG) scrutiny.
At a recent meeting in Prime Minister’s Office, Petroleum Secretary G. C. Chaturvedi updated the Principal Secretary to the Prime Minister, Pulok Chatterjee, on issues pertaining to the KG-D6 fields and also about the fall in production in the KG-DWN-98/3 block.
“The company has been raising frivolous issues, including jurisdiction of the Petroleum Ministry as well as the CAG in auditing its accounts quoting various articles of production sharing contracts (PSCs), a position that was misplaced and unacceptable,” a senior official of the Petroleum Ministry said.
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The Petroleum Secretary told the meeting that finalisation of the decisions was, however, pending due to RIL’s refusal to allow second round of audit by the CAG of its spending on the eastern offshore KG-D6 block.
Gas price revision
The issue of gas price revision also came up during the meeting at the PMO, and it was conveyed to the PMO that the Petroleum Ministry was not in favour of revising the present price of $4.2 million metric British thermal unit (mmBtu) before its expiry date of April 2014.
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The CAG had, in its first round of audit, questioned the reasonableness of costs incurred in the gas field development and said the government should revisit the profit-sharing mechanism. CAG, in the second round, is to audit spending made by RIL during 2008-09 and 2011-12.