RIL cooperating unconditionally with CAG

Company has agreed to provide access to all records and cooperate unconditionally with regard to audit of the block KG-D6

Reliance Industries has agreed to provide access to all records and cooperate unconditionally with the CAG for audit on its spending in the flagging KG-D6 gas fields, the Oil Ministry said today.

Minister of State for Petroleum and Natural Gas Panabaka Lakshmi, in a written statement to the Rajya Sabha, corrected a reply she had given on August 6 wherein she had stated that the Comptroller & Auditor General of India (CAG) was doing a "performance" audit of KG-D6 block.

A statement that Lakshmi laid on the table of the Rajya Sabha said it was to correct "the error by deleting the word performance" audit in the reply given on August 8.

"The Ministry has taken seriously the issue raised by CAG in audit of KG-D6 block. Initially, there were certain issues being raised by the operator, RIL, relating to scope and coverage of audit to be conducted by the CAG. Due to this, there was a delay in taking up the audit.

"However, these issues have since been resolve with continuous engagement of government with audit as well as the operator. Consequently, RIL has agreed to provide access to all records and cooperate unconditionally with regard to audit of the block KG-DWN-98/3 (KG-D6). Audit by the CAG is currently under progress," she said.

CAG Principal Director of Audit (Economic and Service Ministries) A M Bajaj had last month written a letter to the ministry stating that RIL was providing information sought in phases and some records sought were still pending.

CAG, at the request of the Oil Ministry, is auditing KG-D6 spending for 2008-09 to 2011-12. It restarted the audit in April after issues like scope and extent of its scrutiny were resolved.

RIL had previously stated that CAG cannot contractually perform a performance audit on it and Production Sharing Contract (PSC) only provides for a government appointed auditor to verify reasonableness of all charges and credits.

CAG too has stated that it is not planning to do a performance audit of the company but only wants to examine "propriety" of expenses made. For doing that CAG has been given the discretion of requisitioning records as it deems fit.

In the August 6 reply, Lakshmi had stated that "RIL has agreed to provide access to all records and cooperate unconditionally with regard to performance audit of the block KG-DWN-98/3 (KG-D6)."