RIL set to get nod for $1.5-bn capex in K-G D6 gas
04 January 2012
The government has approved the plan of Reliance Industries Ltd and BP Plc to develop four satellite fields at its D6 gas block in the Krishna-Godavari Basin off Andhra Pradesh, according to a number of media reports.
The size of the investment plan is said to be around $1.5 billion (Rs8,000 crore). It is aimed at boosting falling output from the gas field.
An empowered panel comprising officials from the oil ministry and the Directorate General of Hydrocarbons met in New Delhi on Tuesday to deliberate the matter. While there is no official word on the matter yet, the decision will probably be made public soon.
The investment has been pending with the authorities for two years. A report last year by the Comptroller & Auditor General of India accusing RIL of inflating upgrade costs in order to cut the government of its share of the revenue has not helped its cause.
Reliance has vehemently denied these allegations, citing geological and technical reasons to show that the drop in output is justified and further investments are needed. It specifically roped in BP as a partner for its expertise in exploration and production, RIL has pointed out.
Now the government seems to have veered around to RIL's point of view. The Mukesh Ambani-promoted conglomerate has not confirmed the development as yet, but can be expected to do so soon.