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| Appoint experts on RIL gas field costs, says ADAG |
| BS Reporter / New Delhi Aug 26, 2009, 00:49 IST |
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The Anil Dhirubhai Ambani Group (ADAG) has now asked the petroleum ministry to appoint an expert panel to revalidate the escalation in capital expenditure in the development cost of Reliance Industries Ltd’s (RIL) D6 gas block. This follows a letter by RIL to the ministry, justifying the increase in capex.
The group, which is fighting a legal battle with RIL over gas from the D6 fields in the Krishna-Godavari basin, has also sought speedy conclusion of an audit by the Comptroller and Auditor General of India (CAG) in a letter written to petroleum secretary R S Pandey.
“In the interests of transparency and probity, it is requested that the petroleum ministry may kindly ensure the expeditious completion of the CAG audit. While this full and comprehensive audit is on, the ministry should publicly disclose the CAG’s current findings,” the letter written by ADAG group president A N Sethuraman said.
 ADAG contended in its letter that RIL’s capital cost of $8.83 billion was questioned by numerous officials and government officers, including Cabinet Secretary K M Chandrasekhar.
Others who questioned it included the chairman of the Prime Minister’s Economic Advisory Council, C Rangarajan, the letter said. The letter also raises doubts over the independence of officials who revalidated the approved capital expenditure.
“Considering the independence of earlier experts has been questioned, it is also requested that petroleum ministry may kindly arrange to revalidate the capex of KG D6 block by a reputed international expert with experience in deepwater blocks,” it letter said.
RIL has once again made vague and general remarks in its letter without providing any substantial material justifying why the capital expenditure of KG D6 gas went up from Rs 12,000 crore to Rs 45,000 crore when the production only doubled from 40 to 80 million standard cubic metres a day, the letter claimed.
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