CAG to oil ministry: Don’t okay Reliance Industries’ investment plan for KG-D6
17 Nov 2012 11:47 PM GMT
The Comptroller and Auditor General of India (CAG) has asked the Oil Ministry not to approve any of Reliance Industries Ltd's (RIL) investment plans for the flagging KG-D6 gas field unless the company gives it unfettered access to audit its spending.
In a strongly worded letter, the CAG referred to media reports about the ministry giving the nod to RIL's annual capital expenditure for KG-D6 that have been pending for the past three years and advised the ministry not to approve any investment except those of an 'emergent nature'.
'It is well within the knowledge of the Ministry that any increase in capital expenditure is likely to have a significant adverse impact on the government's financial interests,’ the CAG has written to the oil secretary.
Sources, however, said that contrary to reports, the ministry is yet to sign on resolutions approving capital expenditure on the KG-D6 block for the 2010-11, 2011-12 and 2012-13 fiscal pending the resolution of the CAG audit of spending on the block.
The petroleum ministry wants Reliance Industries Ltd to give the CAG 'unfettered access to account books' and pending that, it has not approved the company's investment proposals including annual budget for three years.
'We would like to strongly recommend that pending complete submission of all supporting records by the operator relating to expenditure for the previous years up to 2011-12 and comprehensive and detailed scrutiny thereof to verify that the government's financial interests have not been adversely affected in any way, the ministry may examine all relevant issues closely and carefully before considering the desirability of any future approvals of capital expenditure through the annual work programme and budget, development plans or otherwise, except those of an emergent nature,' the CAG has written.
In a strongly worded letter, the CAG referred to media reports about the ministry giving the nod to RIL's annual capital expenditure for KG-D6 that have been pending for the past three years and advised the ministry not to approve any investment except those of an 'emergent nature'.
'It is well within the knowledge of the Ministry that any increase in capital expenditure is likely to have a significant adverse impact on the government's financial interests,’ the CAG has written to the oil secretary.
Sources, however, said that contrary to reports, the ministry is yet to sign on resolutions approving capital expenditure on the KG-D6 block for the 2010-11, 2011-12 and 2012-13 fiscal pending the resolution of the CAG audit of spending on the block.
The petroleum ministry wants Reliance Industries Ltd to give the CAG 'unfettered access to account books' and pending that, it has not approved the company's investment proposals including annual budget for three years.
'We would like to strongly recommend that pending complete submission of all supporting records by the operator relating to expenditure for the previous years up to 2011-12 and comprehensive and detailed scrutiny thereof to verify that the government's financial interests have not been adversely affected in any way, the ministry may examine all relevant issues closely and carefully before considering the desirability of any future approvals of capital expenditure through the annual work programme and budget, development plans or otherwise, except those of an emergent nature,' the CAG has written.
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