CAG audit of Krishna-Godavari D6 gas block resumes

Published: 11th May 2013 08:00 AM  |   Last Updated: 11th May 2013 08:00 AM   |  A+A-

The row between the Comptroller & Auditor General (CAG) and Reliance Industries Limited (RIL) relating to the scope of audit for Krishna-Godavari(KG)D6 gas block seems to be over for now, with the resumption of the audit under the production sharing contract (PSC) norms.

Earlier the Union Ministry of Petroleum and Natural gas in its letter dated April 2 had appropriately advised RIL to co-operate with the CAG officials and also to provide the  necessary records without any further delay.

“We are therefore, resuming the audit at the operator’s premises on April 11,” said the correspondence between the ministry and the CAG accessed through the RTI.

The face-off between the CAG and the Oil Ministry had escalated in January over the scope and conduct of the audit, after which the former had aborted the process alleging non-cooperation.

The CAG had made it clear that the Oil Ministry remained its primary auditee. In a strongly worded letter to the ministry on March 12,  the CAG said while a performance audit of the operator had not been envisaged, it was important that the audit of Block KG-DWN -98/3 covered  “all records and documents supporting costs, expenditures, expenses, receipts and income” as mentioned in the production sharing contract, including propriety of these expenditure, expenses, receipts and income. Seeking the Oil Ministry’s intervention to resolve the issues related to the scope of the audit, the CAG had asked the former to ensure that RIL would provide access to all the documents which had been requisitioned by the audit officers.  Furthermore, the CAG had stated that an audit was necessary to ensure that the government’s interests had been safeguarded.

The subsequent exchange of communication between the Oil Ministry and the CAG office dated April 23 revealed that the ministry through a letter dated March 18 had assured the auditor of full access to all the records, and accounts under the PSC norms.


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