ONGC claims RIL tapped Rs 30,000 crore gas from its Krishna-Godavari field

NEW DELHI, 30 May-2014, TNN: State-run Oil and Natural Gas Corporation on Thursday claimed before the Delhi high court it has suffered loss of Rs 30,000 crore as a result of Reliance Industries Ltd exploiting – an euphemism for siphoning – gas from its block in the Krishna-Godavari basin.

ONGC claims RIL tapped Rs 30,000 crore gas from its Krishna-Godavari field

ONGC claims RIL tapped Rs 30,000 crore gas from its Krishna-Godavari field

On its part, India’s biggest private oil company played it cool by offering a simple solution to ONGC’s charge. An independent expert panel can determine whether wells in its block have interconnection with the adjacent block of ONGC or how much gas it has lost, the company submitted before Justice Manmohan.

The arguments took place on an ONGC petition claiming Reliance has been tapping gas from its block which is adjacent to the one being operated by the private sector company. The ONGC petition also blamed parent oil ministry for not taking adequate action on its information on the issue.
On Thursday, the Centre too made its submission. It said a meeting among executives of the two companies and officials of Directorate General of Hydrocarbons, the ministry’s technical arm, decided to appoint an expert panel.

After going through the records of that meeting, the court asked ONGC to file its reply and listed further hearing on August 12.

According to the records, ONGC, RIL and DGH decided to send enquiry notices to four third-party consultants before appointment one of them as the expert panel. It was also decided that all parties would share data with the selected consultant through DGH.

After appointment of the independent agency, ONGC, RIL and DGH would work out the project management modalities, the records said. ONGC, in its plea has contended that RIL has drawn out 18 billion cubic meters of natural gas from the combined reserves of both companies since 2009.

During the proceedings, ONGC alleged that the current situation arose due to lack of vigilance on the part of the DGH and the Central government and their failure to take precautionary measures resulted in loss of several thousands of crores of rupees to it. It said that DGH should have insisted upon joint development of the blocks.

ONGC has claimed that of the said total quantity of gas exploited by RIL from its block adjoining that of the PSU, more than half belongs to it. RIL said the blocks were given to it in 2006 and it made the same operational.

While it admitted that it is drawing gas from its own block, it said that the independent expert panel will have to determine if the well of the company is connected with that of ONGC.

ONGC, in its petition, has also accused the government and RIL of not having followed the mechanism internationally accepted for joint development and which has been expressly provided in the Production Sharing Contract (PSC) signed between the Petroleum and Natural Gas ministry and RIL. It has submitted that owing to the fact that the blocks of RIL and ONGC were adjacent to each other, the government should have ordered that they be jointly exploited by both of them.

Posted by on May 30, 2014. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.