CAG refuses to hear RIL, report for Parliament discussion

Posted By: Religare
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CAG refuses to hear RIL, report for Parliament discussion
CAG has refused to provide an opportunity to Reliance Industries to comment on the reports where the auditing report accused the oil ministry and the regulatory arm DGH for their undue favour for private companies while awarding oil and gas exploration licenses.

Turning down the request from oil ministry for inclusion of private companies in the discussion and providing them a chance to clear their stands, CAG had announced that the ministry can raise audit objections after the finalization of its report and being tabled in Parliament.

However, Reliance Industries has blasted the national auditor, whose stern remarks about capital spending in the company's trophy D-6 oil block have sent its shares tumbling, and accused the CAG for complete misunderstanding of legal and contractual issues.

Mukesh Ambani met Prime Minister Manmohan Singh following criticism from the Comptroller and Auditor general (CAG) that his company failed to meet production targets from the Krishna-Godavari basin and gold-plated the expenditure incurred on developing that field for gains.

According to the draft audit report, in the KG-DWN-98/3, or KG-D6, block, the Directorate General of Hydrocarbons (DGH) allowed RIL to hike capital expenditure for developing Dhirubhai-1 and 3, the largest of 18 gas finds in the block, by 117%. The block, awarded to RIL in the first round of bidding under the National Exploration and Licensing Policy, houses India's largest gas discoveries and also a large oilfield discovery. 

Read more about: ril, reliance, dgh, commodities, bse, nse
Story first published: Monday, June 27, 2011, 9:30 [IST]
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