'ONGC had no prior knowledge of gas seepage to RIL blocks'

State-run explorer Oil and Natural Gas Corp (ONGC) clarified on Thursday on the gas dispute with Reliance Industries Ltd, that unlike RIL it had no prior knowledge of natural gas from its block seeping into adjoining fields of the private company.

"ONGC had no knowledge about this earlier. As soon as we came to know about this we took action in 2013. It seems that there is no mention our submission on this in the report (Justice A.P.Shah Committee). I don't know what is the reason for that and why there is no mention of our submissions," ONGC Chairman D.K. Sarraf told reporters here.

In its report submited to the union Petroleum Ministry last week the Shah Committee recommended that RIL pay the government for the "unjust enrichment" by way of drawing natural gas from an adjacent block of ONGC in the easter offshors KG basin since 2009.

But the committee also said it was not able to ascertain in clear terms if the two companies, indeed, have prior knowledge. "I wanted this to be probed further," the single-member panel said.

Yet, it observed, based on some reports of 2003, it appeared that Reliance Industries had prior knowledge about the connectivity, while also not bringing it to the notice of the regulator.

At the same time, it added, ONGC, it seemed, also had some understanding but did not act promptly, and took up the matter six years after it first obtained the relevant information.

The report recorded the RIL charge that ONGC knew of the connectivity way back in 2007 but chose to remain silent till 2013.

"We had very strongly submitted that ONGC had no prior knowledge," Sarraf said.

Sarraf said the company spoke out in 2014 when it apprehended that some portion of natural gas has seeped from its fields to the adjacent KG-D6 block of RIL.

"It was very tough statement to be made. It was made on the technical inputs," he said.

The Shah Committee report said: "The Government of India, and not ONGC, is entitled to claim restitution from RIL for the unjust benefit it received and unfairly retained. ONGC has no locus standi to bring a tortuous claim against RIL for trespass/conversion since it does not have any ownership rights or possessory interest in the natural gas."

Sarraf said that "it is difficult" to say at this point whether ONGC has right over the compensation.

"The current government is acting without any bias. They have no bias against any PSU (public sector undertaking) or a private sector. They would definitely decide on merit. That is my firm belief. That is why they appointed a committee. This means that government means business," he said.

He further said whether ONGC or the government would be paid will be "decided by the various stakeholders".

"It is very difficult to say that whether ONGC or Government will get compensation," he added.

The government had constituted the single-member committee last December under Law Commission Chairman Shah to recommend compensation to ONGC to protect the government interest, following some reports from American consultants D&M on migrating of gas.

Consultants D&M had concluded that 11.122 billion cubic meters of ONGC gas had migrated to the blocks of Reliance Industries. They said of the 58.68 billion cubic meters produced since 2009, some 49.69 billion cubic meters belonged to the private company and 8.981 billion cubic meters could have come from ONGC's side.

At the current gas price of $4.2 per million British thermal unit, the volume of gas belonging to ONGC which the private player has produced is worth around $1.7 billion (Rs 11,055 crore).

--IANS

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