The fate of billions of dollars is at stake, as the management committee that oversees operations of Reliance Industries KG-D6 block meets on Tuesday. The Committee will consider and adopt the block’s audited accounts pending for three years.
The audited accounts, which have to be adopted, stand at over $1.5 billion, sources said. The accounts have not been approved since 2008-09. Besides, the budget of $242.65 million (revised estimate) for 2010-11 is also awaiting the Committee's nod since December 2009.
Tuesday’s meeting is significant, as it comes close on the heels of the Petroleum Minister, S. Jaipal Reddy, promising the contractors expeditious clearances for investment proposals, while asking them to make all records and accounts of the block available to the Comptroller and Auditor General. The company has always shown its willingness to get block audits as per production sharing contract.
The Committee is also expected to consider the re-development plan for MA fields, the appointment of auditors by the contractor and declaration of the commerciality of D-29, D-30 and D-31 finds in the block, sources added. Delayed approvals had led to the company’s board putting all investment proposals of Reliance Industries Exploration and Production Group on the backburner.
The development cost for the MA fields is pegged at $1.96 billion, and that for the optimised development plan at $1.5 billion.
The output from D6 block has dropped below 30 mmscmd after hitting a peak of 60 mmscmd in end-2009. The D1-D3 fields in the block are producing 23 mmscmd and the MA fields 5.8 mmscmd. The total output stands at 28.8 mmscmd. Reliance and its partners in the block — BP and Niko — have been seeking speedy regulatory approvals to plan their investments.