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Petroleum Minister M Veerappa Moily on Wednesday hit back at Communist Party of India (CPI) leader Gurudas Dasgupta, who had alleged Moily was working in favour of Reliance Industries (RIL). He said these charges were part of an attempt by “some vested interests to stall the decision making process in the ministry”. Yesterday, Dasgupta had said Moily was sitting on a proposed penalty of $1 billion on RIL, suggested in 2011-12. He also attacked the minister for not taking back the bulk of the KG-D6 block area held by RIL. “The allegations are baseless and malicious and Dasgupta seems to be getting swayed by some vested interests...to derail a serious attempt to bring back the petroleum sector towards the path of efficiency,” went a statement issued on behalf of Moily.
On the charge that Moily failed to go ahead with an arbitration process regarding the $1-billion fine on RIL, the statement said the file had not been dealt with by anyone in the ministry after December 2012 (prior to Moily taking charge). Dasgupta had also alleged the penalty would increase to $3 billion if one took the drop in KG-D6 production into account.
“No penalty was imposed earlier and it was only denial of a certain cost recovery element due to loss of production which is pending in the arbitration proceedings for the years 2010-11 and 2011-12. No decision has been sought either by the ministry or the Directorate General of Hydrocarbons (DGH) from the present minister for issuance of such notices for the further period,” Moily added.
Dasgupta had said the DGH had recommended that 86 per cent of the entire RIL area should be taken back in line with the contract and this was being sat on. The minister said the file had yet to come to him.
On the charge of the government standing to lose $1 bn on proceeding with arbitration on a KG-D6 investment, Moily said this was done during his predecessor’s time on the basis of the solicitor general’s advice, in June 2012.
