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KG Basin row: RIL issues statement, says it's not against CAG audit

CNN-IBN
Nov 03, 2012 at 09:15pm IST

New Delhi: A day after CNN-IBN reported that the Comptroller and Auditor General (CAG) pulled up the Oil Ministry for agreeing to the conditions of Reliance Industries Limited (RIL) for the audit of KG-D6 Basin, the company on Saturday issued a statement denying it was opposed to an audit by the Constitutional body.

The company pointed out that it had never opposed previous audits ordered by the government. It said in the statement, "RIL has at no time contested the Government's right to conduct an audit by any agency, including the CAG as provided in Section 1.9 of the Accounting Procedure of the PSC."

The full statement said:

RIL issues statement, says it's not against CAG audit

Reliance Industries Limited pointed out that it had never opposed previous audits ordered by the government.

"RIL has at no time contested the Government's right to conduct an audit by any agency, including the CAG as provided in Section 1.9 of the Accounting Procedure of the PSC. At all times RIL has fully co-operated with any auditor appointed by the Government including in several cases where the Government had already exercised its audit rights earlier or where such audit was beyond the period stipulated in the PSC. We are private operators functioning under a PSC. We have seen press statement made by the CAG as reported by the media. We appreciate the fact that the CAG is in agreement that it does not conduct performance audit of private operators and expect that no such performance related audit issues applicable to the Government will be applied to any such audit. As always RIL is fully confident of its technical capabilities and welcomes comments on operational matters if such comments come from experts having the requisite knowledge of the complexities of deep water operations in Oil and Gas sector."

Earlier, the CAG had pulled up the Union Oil Ministry for agreeing to the conditions of Reliance Industries Limited (RIL) for the audit of KG-D6 basin. According to sources, the auditing body told the Ministry that it should have been consulted before assuring the company.

The CAG further refused to accept all the conditions that were laid out by Reliance Industries Limited for audit. Sources said that the CAG told the Oil Ministry that many of the conditions by RIL were restrictive.

Expressing its displeasure in strong words, the CAG said that it could not restrict audit to 'accounting books and records'. The letter was written by the Constitutional auditing body before the Union Cabinet reshuffle on October 26.

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