Your editorial “Gas: Stand firm, but move on” (July 19) makes for interesting reading. The Comptroller and Auditor General of India is within its rights to verify Reliance Industries Limited’s (RIL’s) books to ensure compliance. This will help the government weigh the company’s justifications for revised capital expenditure outlays, which have a bearing on profit petroleum calculations. Since any overstatement of expenditure is likely to reduce revenue, post facto approval in previous years without any basis is a clear violation of the terms of the contract — which indicates weak monitoring in the internal control system. In the process, the fiduciary relationship between the company and its minority stakeholders suffers. Therefore, there is a need for more elaborate and stringent disclosure norms, as those laid out by the US Securities and Exchange Commission.
Also, there is no reason RIL, being a responsible entity, should not co-operate on the matter. No field producing oil and gas has depleted on technical grounds like KG basin has. In Digboi, 100-year-old wells continue to deliver. The sedimentary basin may be different but prognostication is almost the same in the proven, probable and possible categorisation.
Harihar Prusty Noida
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