Tuesday 19 June 2012

CAG slams GSPC for Rs 5,000cr loss


CAG slams GSPC for Rs 5,000cr loss
TNN Mar 28, 2012,

GANDHINAGAR: The Gujarat State Petroleum Corporation Limited (GSPC), the most precious of all Gujarat PSUs, has come under severe criticism from the Comptroller and Auditor General (CAG) in a damning report which a worried Narendra Modi government intends to table in the state assembly only on the last day of the budget session on March 30. The idea is to avoid uproar from the Opposition which has often been critical of the inflated claims of Modi about GSPC's gas find in the Krishna-Godavari (KG) Basin and the tendency of corporates and the political establishment to milk the PSU for their own ends.

The final CAG report, a copy of which is available with TOI, has slammed the losses running into nearly Rs 5000 crore. An entire chapter running into 37 pages is dedicated to GSPC.

The CAG has observed that GSPC with its consortium submitted bid for acquiring KG block "without properly assessing related technical and financial issues." As a result, it said, against the estimated drilling cost of US $ 102.23 million and the total depth committed of 45,348 meters in the minimum work prog ramme (MWP), the actual drilling cost incurred was US $ 1302.88 million (Rs 5,920.27 crore) and the total depth drilled was of 77,395.07 meters.

The report says, "The main reason for the incorrect estimation was adoption of deficient geological model prepared by a joint venture (JV) partner, Geo Global Resources Inc., Canada (GGR). The Company on the ground that GGR was a technical expert, admitted GGR in the JV without taking any financial contribution from it. As a result, the company incurred GGR's share of US $ 175.07 million (Rs 780.81 crore) towards the exploration cost and suffered loss of interest of Rs 104.14 crore during 2007-11, states the report.

The CAG found it "unreasonable" that a time of 14 to 106 months was taken (during 2006-11) for completing the environment impact studies (EIS) in eight out of nine domestic blocks where the company was operator. Besides, against the estimated drilling rate per day of 27.76 meters, the actual rate was 22.49 meters in drilling 16 wells in KG offshore block between July 2004 and April 2010. This resulted in avoidable expenditure of Rs 180.91 crore.

The company incurred total expenditure of Rs 104.29 crore on drilling wells without obtaining approval of Government of India for the field development plan (FDP). In absence of necessary approval, the said expenditure could not qualify for recovery.

During 2006-11, the total revenue from trading of gas was Rs 19,245.39 crore and the revenue from sale of its own production of gas and oil was Rs 1,563.63 crore which indicated that GSPC was focusing mainly on trading rather than production activity.

In trading activities, the report says, GSPC failed to safeguard its interest due to non-insertion of clause for recovery of Take or Pay (ToP) charges in the contracts for sale of gas with 25 to 36 customers out of 38 to 47 customers. This led to potential revenue loss of Rs 502.19 crore in selected cases, CAG pointed out
 
CAG- GSPC $2Trilion Oil Hoarding & RIL Theft - Ambani + Modi Conspiracy
June14, 2012

Honorable Prime Minister
Dr. Manmohan Singh
South Block
New Delhi 110011

Copy Honorable Members of Parliament,

Respected Sir,
I have been reporting of Hoarding & Exorbitant capitalization Oil & Gas by RIL and GSPC based on Media Reports and from Annual Reports of Operators for 4-5 years regularly.

GSPC Deen Dyal Discovery $2Trillion

Sir,

1.] CAG had confirmed there is over 18,303.7 MBbl of Oil plus gas in KG Basin called Deen Dyal Field discovered by GSPC in June2005 this alone is worth $2Trillion in addition to about $2Trillion plus Oil Equivalent of Gas in RIL operated KG D6. This makes just two discoveries worth $4Trillion. There are 3 more similar discoveries by ONGC and RIL also.

Expected Production $200b Per Year

2.]  Sir, normally Oil & Gas discoveries are commercialized over 12-20 years. Thus $4 Trillion Oil & Gas of KG D6 and Deen Dyal annual production rate ought to be $200b annually. The delay therefore has cost us $500b to even $1000b considering both discoveries are very close to sea shore and didn’t require much complicated plumbing. In fact both GSPC and RIL fields are just adjacent to each other.

Just 15 Sq.km and 40 sq.km Exploration Area Commercialized in 78 Blocks Over 500,000 sq.km area Allocated to GSPC and RIL.

India could have been Oil Exporter By Now.

Sir,

3.]  Deen Dyal discovery is just in 15 sq.kilometer area when both GSPC and RIL together has acquired over 5,00,000 sq.km 53+25 Blocks in India.

GSPC Drill Rate Was 22meter Per Day – Record 341 Meter Per Day

Sir,
Here you can see that Transocean Drilled 12,289 meters in 36 days. This is 341 meter per day. Thus Capitalization Was Over 10 Times.

HOUSTON, May 21, 2008 (PRIME NEWSWIRE) -- Transocean Inc. (NYSE:RIG) today announced that the Transocean jackup GSF Rig 127 set a world record for the longest extended-reach well ever drilled at 40,320 feet (12,289 meters) MD (measured depth) with a 35,770-foot (10,902-meter) horizontal section. The well was drilled offshore Qatar in 36 days and incident-free. The new record of 7.6 miles is also the first well in the history of offshore drilling that exceeds 40,000 feet (12,191 meters). The well surpasses by approximately 2,000 feet the prior extended-reach record of 38,322 feet (11,680 meters) MD set by another drilling contractor with a land rig drilling at Sakhalin Island earlier this yea

DELIBERATE DELAYS & HOARDING

4.]  Sir CAG had endorsed when $2Trillion Oil was in place GSPC was deliberately slow in Commercializing Deen Dyal Discovery of 2005.

Theft of GSPC Oil By RIL

5.]  Sir CAG has Confirmed RIL was Stealing GSPC Oil Worth $2 Trillion in Criminal Conspiracy ‘CAG - Reliance Industries Limited (RIL) a private sector enterprise, installed Control and Riser Platform unilaterally in the part area of KG block licensed to the Company on which no other operator has any right without the consent of the Company/GoI.’ by locating its Riser Platform in GSPC operational area POINTING TO DIRECT THEFT.

6.]  Conspiracy to Hire Deepest Most Expensive Rigs

It was deep rooted conspiracy to hire most expensive rigs for relatively shallow waters close to sea shore was to Steal GSPC Oil by RIL.

Ø      Sir Large Drilling Rigs Can reach up to 12 kilometers Horizontally therefore RIL could extract all the $2Trillion Oil in Deen Dyal Field of GSPC with Narendra Modi connivance.

Ø      Sir I was PUZZLED why DGH had allowed ‘Most Expensive Rigs For Basically Shallow Depths.’ Drilling Rigs hired could reach 35000 ft or to every inch of Deen Dyal Field holding $2 Trillion Oil of GSPC.

6.]  Sir CAG didn’t pull up GSPC when both KG D6 and Deen Dyal Field are adjacent to each other it delayed drilling by almost 4 years and after discovery in 2005 another 4-6 years when prospects of discovery were 99% in 2001 itself.

7.]  Sir I have also attached three dimensional picture of RIL production platform that is in GSPC production area and most of the Oil Wells in GSPC area are connected to RIL platform.

8.]  Sir this RIL-GSPC Conspiracy Led To Failure of the KG D6 that was basically Gas Discovery but RIL was through it was ‘Extracting Oil of GSPC.’

9.]  Sir It Is Regretted CAG did not Computed ‘Real Production Losses that to my estimation exceed $500b’.

10.]  Sir GSPC production plan is just $1.42b only against $9.5b by RIL in spite Deliberately Slow Development.

Please order CBI, JPC in to Grand Conspiracy to Hide World Biggest Loot and Conspiracy to Over Throw UPA government.

Please TAKEOVER $4 Trillion Oil & Gas Reserves Of RIL and GSPC and Hand Them to ONGC.

11.] It is also related that RIL after securing 4G broad Band with much greater capability than India’s Entire Telecom infrastructure Went On Hold. Copy of RIL press release Speaks Loudly. 

Thank you,
Faithfully

Ravinder Singh
Inventor & Consultant
INNOVATIVE TECHNONLOGIES AND PROJECTS
Y-77, Hauz Khas, New Delhi-110016, India.
Ph; 091-9910693464, 9718280435
Ravinder Singh* is a WIPO awarded inventor specializing in Power, Transportation, Water, Energy Saving, Agriculture, Manufacturing, Technologies and Projects.

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