Dasgupta demands quick decision on $2.4 billion penalty to RIL

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DASGUPTANEW DELHI, September 6; Communist Party of India MP, Gurudas Dasgupta on Friday wrote to Prime Minister, Manmohan Singh seeking an immediate decision by government to impose $2.4 billion penalty on Reliance Industries Limited (RIL) due to deliberate hoarding of gas production from KG-D6 block.

Mr. Dasgupta also asked Dr. Singh to direct the Petroleum Ministry to take immediate steps to ensure that RIL is made to pay $4.2 mbtu price for the shortfall of the gas from KG-D6 facility even after April 2014.

In a letter to the Prime Minister, Mr. Dasgupta, while enclosing a copy of the report of Gopalakrishnan Committee, set up to study the decline in gas production from the KG basin block, said the report clearly nails the lie of geological uncertainty being used by RIL. Since this report had been accepted by both the Directorate General of Hydrocarbons (DGH) and the Petroleum Ministry, the Government should not succumb to the devious ploy of the Petroleum Minister to reopen the issue to give undue benefit to RIL and weaken the government case in arbitration.

“You are aware that the government had imposed a penalty of $1 billion on RIL for deliberate default in production. I had pointed out that this amount works out to $1.8 billion for 2012-13 and $2.4 billion for the current year due to continuing shortfalls. It is learnt that DGH has agreed with my contention and recommended penalty of $1.8 billion for 2012-13. However, the Petroleum Ministry has not issued a fresh notice to RIL based on DGH’s suggestion and the Petroleum Minister is stalling the matter. I would urge you to the direct the Petroleum Ministry to issue a fresh notice to RIL immediately, both for last year and current year,’’ Mr. Dasgupta added.

He reiterated that RIL should be asked to supply the shortfall in quantity of gas from the KG D6 at old rate of $4.2 mbtu and a penalty of $2.4 billion be imposed for deliberate default.

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