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M Verappa Moily planning to give oil field to Essar cheaply: AAP alleges

Wednesday, 16 April 2014 - 6:29pm IST | Agency: PTI
  • Prashant-Bhushan ARIJIT SEN DNA

Firing a fresh salvo against the UPA government, Aam Aadmi Party today alleged that Union Oil and Petroleum Minister Verappa Moily is planning to give an oil field off Bombay High to the Essar Group at dirt-cheap price.

Party leader Prashant Bhushan said this move will result in the government losing approximately Rs 52,000 crore. He alleged that Moily had moved a cabinet note stating that the Ratna oil field, a medium size oil field 130 km south-west of Mumbai, be given to the Essar group at price fixed in 1993. "In 1993, the Union government decided to give the Ratna oil field to the Essar Group. The Letter of Award was given to the company in 1996, but the contract was not signed," Bhushan said at a press conferene here. "But in his last days in office Moily has asked his officers to prepare a cabinet note on the issue and that the oil field contract should be given to the Essar group," he added.

He said that despite Ministry officers warning of a huge loss of government revenue, Moily was going ahead with the move.

An Essar spokesperson, however, said it had won the Ratna R-series field in an open bidding and it was in national interest that the reserves be developed to cut imports. "Essar was awarded the Ratna R-series block in an open and transparent manner through a bidding process. We are not aware of any internal notes or documents of MoPNG in the matter. However, it is in the national interest to make any block operational especially when there has been significant delay and the country is importing over 70 per cent of its crude requirement at a high cost in foreign exchange," the spokesperson said.

Bhushan said that in 2008 the Cabinet Secretary had noted that "proposal involves substantial abondonment of government revenue" and that the contract too had not been duly concluded. "The officers said that over the period of time the value of oil field has increased and so has the dollar rate. As the contract was not signed, the Ministry was not legally bound to sign the contract with the Essar group. Instead it should invite fresh bids as that would be a prudent option", Bhushan said. 

"Over a period of time the price of the (Ratna) oil field has increased from Rs 1.44 billion in 1994 to Rs 9 billion to 2013 and fuel prices have increased by 20 times," he said.

The senior advocate alleged that Moily had also approached the cabinet for relaxation in three gas basins D29, D30 and D31 to benefit Reliance Industries. "The basins were awarded to Reliance in 2002. The contractors were supposed to make discoveries within a period of 10 years failing which the basins have to be surrendered. 

The Director General of Hydrocarbons had said that since Reliance failed to show any kind of discovery, as per the contract, the basins should have been surrendered in 2012. 

Moily has sought amendment in the contract to benefit Reliance for which he moved a note with the Cabinet Committee on Economic Affairs," he alleged. The AAP-led Delhi government has already registered a case against Moily and Reliance Industries Chairman Mukesh Ambani in the KG basin issue. 

AAP has said that it will also approach the Election Commission to stay the order as it was being done despite the Model Code of Conduct.




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