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HindustanTimes Fri,01 Aug 2014

Govt may hire consultant to end KG-D6 gas row with RIL

Anupama Airy , Hindustan Times  New Delhi, September 25, 2013
First Published: 23:18 IST(25/9/2013) | Last Updated: 23:20 IST(25/9/2013)

In response to queries raised by Mukesh Ambani-led Reliance Industries Ltd (RIL), the petroleum ministry is understood to have moved a Cabinet note to appoint an independent consultant and put to rest the ongoing controversy over a fall in the gas output from India's biggest offshore block, KG-D6.

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However, petroleum minister Veerappa Moily was quoted by PTI as saying that a Cabinet approval may not be needed.

The consultant will verify RIL's claims that the fall in gas output from producing fields (D1 and D3 in the KG-D6 block) is a result of geological complexities and look into counter claims by the regulator and some political parties that the company deliberately suppressed the output to get a higher price of gas that will be applicable from April 1, 2014.

Sources close to RIL claim that timely approvals by the petroleum ministry (when Jaipal Reddy was the petroleum minister) could have arrested the decline in gas production, currently at around 10-11 mscmd.

"The output could have sustained at 20 million metric standard cubic metres of gas per day (mmscmd) had the government given timely approvals for undertaking work in the KG-D6 block," a source close to RIL said.

Moily is pushing for fast resolution to the issues threatening investments in the oil and gas sector. Issues such as delayed clearances for undertaking work programmes have been raised by most operators including Reliance, Cairn, BP and others.

The petroleum and the finance ministry had earlier proposed denying RIL the higher price for gas as the company failed to deliver the committed quantum of gas from the D1 and D3 gas fields.


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