ONGC Drags DGH, Oilmin, RIL to Court
RIL says litigation ‘unwarranted’, all plans approved by government
ONGC has alleged that Reliance Industries may have drawn natural gas worth thousands of crores of rupees from a common reservoir in the KG-D6 block, and taken the matter to the Delhi High Court, accusing the oil ministry and its technical arm of turning a blind eye to the issue. Justice Manmohan issued notices to the Union government, the Directorate General of Hydrocarbon (DGH), and RIL, and posted the case for further hearing on May 29. ONGC told the court that it wants a “truly independent” agency to examine the matter, and compensation from RIL if the independent agency finds that the private company has drawn gas from a common reservoir. ONGC counsel Dushyant Dave later told reporters that ONGC may claim compensation of over .` 25,000 crore. Government counsel Neeraj Chaudhari accepted the notice. He said the issues were being sorted out in a joint committee comprising RIL and ONGC under the aegis of the DGH. “Meetings are going, they (ONGC) are taking part,” he contended. Reliance said ONGC’s litigation was unwarranted as the two firms had constructively engaged in sharing data and resolving the matter with the help of a third-party expert – the most recent meeting being as late as on May 9. “ONGC and RIL have jointly signed Minutes of a Meeting to record such an understanding. Any inference prior to such assessment is mere speculation and commencement of legal proceedings at this juncture is unwarranted. Any claims of any impropriety on the part of RIL, if these have been made, are base- less and RIL will take appropriate steps to safeguards its position and rights,” RIL said in an emailed statement. ONGC has now dragged even the former Director General of Hydrocarbons and its administrative ministry to court. ONGC said the DGH should have been vigilant while clearing RIL’s field development plan, which involved drilling wells “at such a tantalisingly close distance of 50 metres to 350 metres” from the common boundary of the blocks. It also said that the management committee, which has two government representatives, should not have approved RIL’s plans to drill wells near ONGC’s block, particularly when it had access to RIL’s data. Reliance said its plans had been approved by the committee. “All petroleum operations undertaken by RIL have been in accordance with the Production Sharing Contract and the Development Plan approved by management committee, which has government representatives with veto powers. All well locations and well profiles have been specifically reviewed and approved by the management committee,” RIL said in the statement. A government official, who did not want to be identified, expressed surprise that ONGC had taken up the matter only last year, many years after RIL’s development plan was approved.
The two had earlier signed an MoU to share infrastructure in the basin, which would have significantly reduced costs for the state-run firm. Recently, RIL’s lawyer Harish Salve said in the Supreme Court that Reliance was being singled out for criticism for its performance in the KG-D6 block, while there was no scrutiny of ONGC’s nearby blocks, where the project’s cost estimate and completion period were revised many times. “Even after 18 years, none of ONGC discoveries has matured to a development plan stage,” Salve had argued. ONGC did not mince words in its petition before the high court. “Pertinently, four wells have been drilled by Respondent no. 3 (RIL) within distances ranging within 50 mts to about 350 mts from the Blocks of Petitioner and wells have been so drilled and constructed that there is a pre-planned and calculated slant/angular incline towards the gas reserves of Petitioner with a clear idea to tap the same,” ONGC said in its petition.