PMT audit meeting for August 4

Vol 13, PW 4 (30 Jul 09) News in Brief

India’s oil ministry appears determined to carry out a fresh audit of the BG-operated Panna, Mukta and Tapti oil and gasfields offshore Mumbai in response to DGH concerns of â€کgold plating’ (inflating costs) and discrepancies in the allocation of gas in the past.

PETROWATCH learns that oil ministry joint secretary exploration DN Narasimha Raju has convened a meeting with consortium partners BG, ONGC and Reliance in Delhi on August 4 to discuss the proposed audit. Still unclear is if the audit will begin from the inception of the PMT contract in 1994 when the government signed the PSC with disgraced operator Enron or from 2002 when BG took over.

BG staunchly opposes any fresh audit, arguing that under PSC rules audits cannot be backdated beyond two years and that the PMT books are regularly audited anyway. But in April this year the oil ministry over-ruled BG saying it is within its â€کsovereign’ right to conduct a fresh audit irrespective of the PSC.