RIL says its open for audit on KG Basin reserves

Hyderabad, Apr 7 (UNI) Amid controversy over the quantum of gas find in the Krishna-Godvari (KG) Basin, Reliance Industries Ltd (RIL) today expressed its willingness for 'any' review by the Union Petroleum Ministry even as the company rolled out plans to invest about Rs 50,000 crore in development of gas field and pipelines in Andhra Pradesh over the next three years.

Clarifying to the media here today on reports of the company inflating gas reserves at the Dhirubhai-6 field in the KG Basin, RIL President and Chief Executive Officere (Petroleum) P M S Prasad said ''we will be happy to anybody auditing the reserves (in the D-6).'' ''Let the government appoint an independent expert committee for assessment,'' he said.

Stoutly denying the reserves were ''inflated,'' he maintained RIL was moving ahead with its 5.2 billion dollars initial capex plans to extract 80 million cubic metre of gas per day in the next six years.

It will begin with half the quantum in the next two years.

Mr Prasad asked why the company should inflate the reserves as it amounted to making a commitment to deliver the (quantum of) gas.

However, it will be a good beginning if the Union Government undertook stringent auditing as in the US, he added.

The Director General of Hydrocarbons had suggested an independent expert committee to audit the gas 'finds' given by RIL along with those of Public Sector ONGC and Gujarat State Petrochemicals Ltd (GSPL).

As the commercial exploitation in KG Basin is due from June 2008, the RIL, over the next three months, will negotiate and enter into MoUs with bulk consumers, including the private power developers for supplying about six million cubic metre of gas a day.

It was also open for further negotiations with the Andhra Pradesh Government for supply of K G Basin gas to the state power units and gas-based industries.

However, the APM price being sought by the state was 'unacceptable' as even the Centre, under the non-administered price regime, had suggested selling gas at 'market determined price.' The company plans to lay by next year 1,950 km of pipeline to provide piped gas to 17 lakh householders in 33 cities of 19 districts in Andhra Pradesh, which will need an investment of Rs 30,000 crore.

The funds for development of the gas field will be raised from external commercial borrowing and internal accruals. The investment on pipelines will be through bank funds.

UNI