Will protect ONGC's interest in Bay of Bengal gas row: Pradhan

Oil Minister Dharmendra Pradhan today vowed to protect government and ONGC's interest on the issue of state-owned firm's natural gas from Bay of Bengal block flowing to adjoining fields of Reliance Industries.
Pradhan said a committee under Law Commission Chairman A P Shah has been constituted to look into acts of omission and commission and recommend compensation to ONGC.
"We received report of D&M (on gas migration issue) on November 30 and we saw it on December 1. D&M report has talked about some technical things like flowing of gas from ONGC's blocks to adjacent Reliance block," he told reporters here.

US-based consultant D&M, in its final report, stated that as much as 11.122 billion cubic meters of natural gas, worth over Rs 11,000 crore, had migrated from idling Krishna Godavari fields of Oil and Natural Gas Corp (ONGC) to adjoining KG-D6 block of RIL.
The Shah panel has been constituted "to understand the financial implications and to protect the interest of the government and government companies."
"We will protect government and PSU interest," he said.

The one-man committee will submit its report in three months on "how to compensate the losses keeping in mind the legal and business aspects."
The panel has been asked to report any "acts of omission and commission" on part of all the stakeholders including RIL, ONGC, the Directorate General of Hydrocarbons and the government, he said.

"This will also give us a chance to analyse all those who are responsible for this kind of disorder. The government will act after the commission submits the report in three months," he said.
According to the terms of reference, the committee has been asked to "quantify the unfair enrichment, if any, to the contractors of the adjacent block KG-DWN-98/3 (KG-D6) and measures to prevent future unfair enrichment to these contractors on account of gas migration."
Pradhan said the Shah Committee "will also make recommendations on how to avoid recurrence of such incidents in future."
DeGolyer and MacNaughton (D&M) in its report established that reservoirs in ONGC's Krishna Godavari basin KG-DWN-98/2 (KG-D5) and the Godavari-PML are connected with Dhirubhai-1 and 3 (D1 & D3) field located in the KG-DWN-98/3 (KG-D6) Block of RIL.

It states that as much as 11.122 billion cubic meters of ONGC gas has migrated from Godavari-PML and KG-DWN-98/2 to KG-D6.
Of the 58.68 bcm of gas produced from KG-D6 block since April 1, 2009, 49.69 bcm belongs to RIL and 8.981 bcm could have come from ONGC's side, D&M said.
At gas price of USD 4.2 per million British thermal unit, the volume of gas belonging to ONGC which RIL has produced comes to USD 1.7 billion (Rs 11,055 crore).