RIL complains to oil secy over bureaucratic delay

Executive Director lists several routine issues stuck for months.

With bureaucratic red tape threatening to derail its multi-billion dollar oil and gas hunt campaign, Reliance Industries Ltd (RIL) has complained to the petroleum secretary regarding routine matters being stuck for review/approval for months.

RIL Executive Director P M S Prasad wrote to Secretary S Sundareshan, listing a number of operational issues at its oil and gas production and exploration sites that had not been approved for months.

“Of late, we have been facing major difficulties in getting even routine proposals reviewed/approved,” he wrote. “You will appreciate that such delays impact the production sharing contract schedules for exploration, appraisal and development programmes.”

He said the management committee (MC), comprising representatives from the oil ministry, the Directorate General of Hydrocarbons (DGH) and the oil company, had not approved the work programme even at the KG-D6 block — which housed the nation’s largest gas fields — for the current financial year.

“Some of the major issues still awaiting MC review/approval (include) the Work Programme and Budget (WP&B) for 2009-10 (revised estimate) and 2010-11 (budget estimate) for KG-D6,” he wrote.

Normally, the WP&B is approved at the beginning of the financial year. However, it has still not been approved, with just two months left in the financial year.

“While we are willing to incorporate inputs from DGH and provide them with all reasonable information and justification, we request the distinction between the review and approval function of the MC is maintained and respected by all the parties,” he wrote.

Adding: “Failure to maintain this distinction is resulting in a situation wherein routine review activities (such as the work program and the budget) mandated under the production sharing agreement take inordinately long time.

As an example, Prasad cited the issue of Declaration of Commerciality of four gas discoveries made by Reliance in KG-D6, pending since February last year.

“While we are committed to our contractual obligations, we request the government, as a party to the contract, to continue giving full support to our operations,” his letter said.