RIL fined another Rs 2,500 cr for gas under-production
The Union Government has slapped an additional penalty of $380 million (around Rs 2,500 crore) on Reliance Industries Ltd (RIL) and its partners for producing less than targeted natural gas from eastern offshore KG-D6 fields. With this, the total penalty, which is in form of disallowing recovery of cost incurred, for missing the target in five fiscal years beginning April 1, 2010, now stands at a cumulative USD 2.76 billion. The Production Sharing Contract (PSC) allows RIL and its partners BP Plc of the UK and Canada’s Niko Resources to deduct all capital and operating expenses from the sale of gas before sharing profit with the government. Disallowing costs will result in government profits rising.