CAG raps govt over delay in signing Ratna R-Series contract

Tribune News Service

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New Delhi, December 18

The Comptroller and Auditor General (CAG) has pulled up the government for 16-year delay in giving the Ratna and R-Series oil and gas fields which led to over Rs 26,000 crore of hydrocarbons production being deferred.

The CAG report also said there was a Rs 1,086-crore damage to unused facilities in the Arabian sea.

The medium-sized Ratna and R-Series (R&RS) fields off the Mumbai coast have been languishing since 1993 when the PV Narasimha Rao-led Congress government decided to invite bids.

The fields were awarded to a consortium led by Essar Oil in 1996. The Cabinet Committee on Economic Affairs (CCEA) in 1999 approved finalising and concluding PSC within six months after negotiations are held by Negotiating Team of Secretaries (NTS) but the same has not been signed to date over what royalty and cess is to be charged from Essar Oil and partners.

The official auditor said considering four years and eight months as the time that would have been taken to start production, R&RS fields should have been up by October 2005.

The CAG said based on the development plan submitted by the winning consortium, “domestic production of 56 million barrels of crude oil (valuing Rs 25,650 crore) and 920 million standard cubic meters of natural gas (valuing Rs 550 crore) had been deferred during October 2005 to March 2015,” it said.

Further, government share of Rs 1,050 crore as royalty and cess on crude oil and Rs 55 crore as royalty on natural gas for the period also remained deferred and unrealised, the CAG said.