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The Centre has extended services of S Rath, former Director (operations) of Oil India Ltd, to assist Justice AP Shah Panel in understanding the technical nuances of gas migration dispute between ONGC and Reliance Industries Ltd.
Shah had requested the Ministry for Petroleum & Natural Gas to engage a domain expert who will help understand the complex issue and interpret the technicalities pointed out in the report of US-based consultant DeGolyer and MacNaughton (D&M).
“After the last meeting, a request was made to help the panel understand technical issues like if gas has migrated, how do you know the volume, how will the valuation be done…,” a source in the know of the development said, adding that, “the Panel can also call D&M for any clarity.”
In December, the Ministry referred the American consultant’s report on the dispute between RIL and ONGC to a single-member panel under Justice AP Shah. The term of reference for the panel is to consider legal, financial and contractual provisions and suggest the action to be taken by the Centre within three months. The panel has also asked all stakeholders, including ONGC and RIL, to submit their views on the terms of reference by end of this month.
Since the panel was constituted on December 15, it has to submit its report by end of three-month period – March 15, 2016.
The panel will also suggest a future course of action and ‘quantify the unfair enrichment’ on account of gas migration as well as recommend action to be taken to ‘make good’ on the losses suffered by ONGC due to gas migration and how to prevent further ‘unfair enrichment’.
The D&M report has found that as much as 15 per cent of the gas that RIL and its partners pumped out of their block in the Krishna Godavari basin could belong to ONGC.
The report has also confirmed ‘reservoir continuity’ or in other words the absence of any barriers between the blocks of the two parties. The reserves in the D-1 and D-3 fields of the Reliance-BP-Niko KG D6 block total 2.9 trillion cubic feet, of which 2.1 trillion cubic feet has already been extracted.
While BP has agreed to cooperate with the committee, the other partners in the KG-D6 block – RIL and Niko Canada – have questioned its legality.
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