Veerappa Moily assures Cairn, Reliance and BP of resolving pending issues
Oil Minister Veerappa Moily has assured private oil firms Cairn India, Reliance and BP that their pending issues would be resolved as soon as possible.
The minister heard their views on contentious issues such as the CAG's audit of Reliance's KG-D6 block, approvals to raise the output of Cairn's oilfiled in Rajasthan and long-pending clearance for pricing of coal bed methane, industry and government officials said.
The minister has assured CEOs of the government's support for industry and asked them to concentrate on enhancing India's oil and gas output, officials present in the meeting said.
"We discussed outstanding issues and the meeting was very constructive and positive. It is surprising that the minister gave us time in less than 20 days of assuming the office. This was difficult in the previous regime," one executive said requesting anonymity. RIL Executive Director PMS Prasad led the team of Reliance executives. BP India chief Sashi Mukundan and Cairn India interim chief executive P. Elango were also present with officials of their companies. Oil Secretary GC Chaturvedi and Director General of Hydrocarbons RN Choubey also attended the meetings.
Cairn India sought the minister's intervention to cut bureaucratic delays that were holding it back from raising the Rajasthan block's output from 175,000 barrels per day to 300,000 bpd. "The matter is pending for more than 11 months despite the fact that India spends valuable foreign exchange in importing crude oil," an industry official said.
Cairn is asking the ministry to allow it to further explore the Rajasthan block, where potential to find new oilfields are very high. It informed the minister that 300,000 barrels per day output would translate into Rs 30,000 crore average annual revenues to the exchequer and reduce India's oil dependency by about $8.5 billion.
RIL and BP together held discussions with Moily as they are partners in several blocks. "Companies wanted faster decision-making by the ministry and management committees so that E&P works would not suffer," one government official said. RIL also asked the ministry to approve the CBM price, pending that it was unable to develop Sohagpur (Madhya Pradesh) blocks. RIL's CBM pricing proposal is pending for about a year.