The Petroleum Ministry has written to the Comptroller and Auditor General that audit of KG basin off Andhra Pradesh coast, which is operated by Reliance Industries, must be conducted as per Section 20 of the C&AG (DPC) Act, 1971.
This means CAG can audit only books of accounts and will not do a performance audit, a process that would have meant judging the efficacy of technology and output from the field.
CAG Vinod Rai had written to Petroleum Minister M Veerappa Moily on February 14 that RIL was ?stonewalling? efforts for an audit. ?Not only has access to records been denied but the operator has tried to constrain by putting forth restrictive conditions which impinge upon the basic mandate, rights and obligations of audit under the C&AG (DPC) Act, 1971. In spite of repeated reminders….the operator of KG-DWN-98/3, namely RIL, has not provided them access to records,? Rai wrote to Moily.
RIL had claimed that while it was open to an audit, the same must done as per its production sharing contract with the government. Sources said the ministry wrote to CAG on March 4 that it had ?re-examined? the matter and concluded that the request to CAG to conduct audit of RIL?s KG-DWN-98/3 is dealt with under C&AG (DPC) Act. The letter said the scope, extent and manner of audit is spelt out in the production sharing contract.
The sources said CAG will take a decision on the ministry?s letter in a few days.
The ministry, meanwhile, may seek the opinion of the Solicitor General on whether the CAG?s assertion that it should be allowed to carry out a more detailed audit has merit.