Moily calls ONGC petition ‘serious matter’, seeks if action justified

It seeks directions to the Centre to set up an independent agency to establish the amount of gas drawn by RIL and apportion ONGC’s share.

Written by Amitav Ranjan | New Delhi | Published: May 27, 2014 1:38 am

Former petroleum minister M Veerappa Moily is fuming because Oil and Natural Gas Corp has dragged its owner — the Union of India — to court for the alleged theft of 18 billion cubic meters of natural gas since 2009 by Reliance Industries Ltd from adjacent ONGC blocks in Krishna Godavari Basin.

“It is extremely serious matter where a government-owned company has taken recourse to writ petition against its largest stakeholder Union of India and its regulating agency Directorate General of Hydrocarbons alleging omissions and commissions on their part,” Moily wrote to petroleum secretary Saurabh Chandra.

On May 22, Moily asked Chandra to enquire and take “appropriate action” whether ONGC was justified in filing the writ petition against its major shareholder and “fix accountability either within the ministry, DGH or ONGC for mishandling the matter and allowing it to escalate to this level”.

ONGC’s writ petition in the Delhi High Court on May 15 alleges that theft occurred due to lack of vigilance of the DGH and the ministry and their failure to take precautionary steps. It seeks directions to the Centre to set up an independent agency to establish the amount of gas drawn by RIL and apportion ONGC’s share.

It also accuses the ministry and RIL for not adhering to the globally-accepted joint development mechanism that is provided in the production sharing contract signed between the government and RIL for Block KG-DWN-98/3.

Moily wrote that ONGC’s move to make the Union of India (through petroleum secretary) and DGH respondents showed “signs of systemic failure” and needed “immediate corrective action”. “As far as I recall, the matter was never brought to my notice and I am not aware whether Secretary was briefed about the development,” he added.

“It will be absolutely necessary to examine at what level this decision (to file writ petition) was taken in the ONGC and why ONGC did not feel it appropriate to give an advance intimation/notice to the ministry before taking such a drastic step,” Moily directed.

Documents with The Indian Express show that the exploration division of the ministry was regularly apprised of the joint meetings between RIL and ONGC conducted by DGH on sharing geological and geophysical data of their blocks KG-DWN-98/3, and G-4 Godavari and KG-DWN-98/2 blocks. DGH was regularly informing the Joint Secretary (Exploration) who is also on the Board of Directors on ONGC.

The last meeting on the issue was held on May 9 and the ONGC moved the court a day before Friday’s election result. ONGC believes that RIL’s D6-A5, D6-A9 and D6-A13 wells drilled close to the KG-DWN-98/3 block boundary may be draining gas from G-4 field while well D6-B8 may be draining gas from DWN-D-1 field of KG-DWN-98/2 block.

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