Minister of State in the Ministry of PETROLEUM AND NATURAL GAS
(SHRI R. P. N. SINGH)
(a) to (c): A statement is laid on the table of the House.
STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (c) OF THE LOK SABHA STARRED
QUESTION NO. 168 (8th POSITION) BY SHRI SUGUMAR K. TO BE ANSWERED ON 11.08.2011
REGARDING âAudit of Oil Companiesâ.
(a) & (b) Ministry of Petroleum & Natural Gas had requested Comptroller and
Auditor General of India (C&AG) to undertake a special audit of the eight Blocks
namely Panna-Mukta, Tapti, KG-DWN-98/3(KG-D-6), RJ-ON-90/1, Ravva, Hazira,
KG-OSN-2001/3 and PY-3, vide letter dated 13th November 2007.
As per Production Sharing Contracts, the Government has a right to conduct
audit through its own representatives or through a qualified firm of recognized
Chartered Accountants, registered in India, within a period of two (2) years of
the close of the Financial Year (longer period as may be required in case of
Accordingly, in these PSCs the Government had conducted the audit through
the qualified firm of recognized Chartered Accountants, appointed by the Government
for the years up to 2006-07. However, considering the large stakes involved in these
PSCs in form of Royalty and Profit Petroleum, the Government requested the C&AG for
carrying out Special Audit for these PSCs.
The C&AG has conveyed that initially audit of records would be taken up for
four blocks namely Panna-Mukta, Tapti, KG-D6 and RJ-ON-90/1, for two financial years
i.e. 2006-07 & 2007-08 with access to records of earlier years linked to transactions
of these years. Initially the operators showed reluctance in giving access of these
records to C&AG, on the ground that the Government has already exercised its right
of audit under the PSC. However, subsequently, on specific request from C&AG regarding
access to the specific records related to these four blocks, this Ministry took up
the matter with the Operators of these four blocks to facilitate access to the records.
Subsequently, Operators had agreed to provide all details and access to the
records to facilitate audit by C&AG.
(c) CAG has submitted draft Performance Audit report on Hydrocarbons Production
Sharing Contract (PSCs) vide their letter dated 07.06.2011 (marked confidential).
This Ministry with the assistance of DGH, the technical arm of the Ministry on PSC
matters, had submitted the reply to CAG on 8th July 2011. The comments received from
the Operators viz. M/s Cairn, RIL and PMT JV in respect of draft observations
pertaining to RJ-ON-90/1, KG-DWN-98/3, Panna-Mukta and Mid & South Tapti blocks
respectively, have also been forwarded to CAG for consideration before finalizing
the audit report. An exit conference was conducted by CAG on 12th July 2011 with
the contractor of the four (4) blocks / fields namely RIL, Cairn, BGEPIL and ONGC
and also with DGH and MOPNG. The CAG is in the process of finalizing its report.
Thereafter, it will be tabled in the Parliament.