Govt may penalise RIL for gas delay

The government plans to penalise Reliance Industries if it delays gas production from its field in the Krishna-Godavari basin beyond mid-2008.

Petroleum Secretary SC Tripathi today told reporters that the ministry had asked the directorate-general of hydrocarbons (DGH) to look into the reasons for delay in the commencement of gas production. "We are looking at provisions of penalty in the exploration licence," he said.

Tripathi said RIL had indicated to the petroleum ministry a date not earlier than June 2008 to start producing 40 million standard cubic metres per day of gas, even though the government wanted it to be advanced to January 2008.

"There certainly will be penalties (if gas production is delayed beyond June 2008)," he said.

Reliance has cited non-availability of rigs and service contractors for the delay in developing Dhirubhai-1 and 3 gas fields, two of the 13 discoveries the company made in the block.

RIL discovered 14.5 trillion cubic feet gas reserves in deepsea block KG-DWN-98/3 and had contracted to supply gas to National Thermal Power Corporation by mid-2007. The company has now indicated June 2008 as the delivery date.