Expressing surprise over oil field regulator DGH's observation that inflation of capital expenditure would not benefit Reliance Industries, Anil Ambani Group firm RNRL demanded that the CAG audit of the RIL-owned fields be made public for the sake of transparency.
Commenting on DGH's statement that Production Sharing Contract provides for auditing of the actual expenditure by three sets of auditors - the management committee appointed auditors, Government appointed auditors and by Comptroller and Auditor General of India (CAG), RNRL said RIL stands to directly benefit from inflating field development cost.
"In the interests of transparency, and to set the matter at rest, DGH should publicly disclose the full reports of CAG, Indian experts, international engineering consultants, and independent auditors," RNRL spokesperson said in a statement.
Expressing surprise at the DGH comments that inflating the capex does not benefit RIL, it said as per the Production Sharing Contract, RIL is entitled to first recover its entire capital expenditure, before the Government gets any share.
"RIL has substantial motivation to claim higher capex. Simply put, the more RIL claims to have spent on capital expenditure the less the Government gets as its share from the revenues, and more delayed is the timing when the government gets its revenues," the spokesperson said.