<p>RIL said capital expenditure for KG-D6 fields increased from USD 2.47 billion in 2003 to USD 8.83 billion due to a 2.5 times increase in reserves, trebling of production facilities, doubling of peak production, hike in number of wells, field life and inflation in equipment and services industry.<br /><br />Its President and CEO (Petroleum) PMS Prasad on August 20 wrote to Oil Secretary R S Pandey, saying "certain parties are bent upon holding the country's price and national interest hostage to their own narrow commercial interests and are stopping at nothing to destroy the reputation of the country."<br /><br />"It is necessary to nip these malafide endeavours in the bud for the sake of the energy security of the country," wrote Prasad and was a day later appointed to the board of RIL.<br />Without naming ADAG, he said the "unprovoked and unjustified attack on the credibility of the project" was being carried out by "vested interests having little understanding of any mega project execution, leave alone complex deepwater projects."<br /><br />Comparing with similar deepwater projects by world's top energy majors, Prasad said KG-D6's finding and development cost of less than USD 5 per barrel of oil equivalent was among the lowest in the world.<br /><br />"Ultimately cost and profit share in a Production Sharing Contract (PSC) regime are not dependent on capex estimates but have well informed systems of checks and balances to monitor actual cost recovery," Prasad wrote. "This includes tendering procedures, approvals by the Management Committee or the Government, statutory audits, and audit by the Government under the PSC."<br /><br />RIL stated that two independent experts appointed by DGH had validated the technical scheme for development and estimated capex as very competitive.<br /><br />"However, to demonstrate the transparency and openness of systems as operated by us within the PSC in accordance with the best international petroleum industry practices, RIL has also agreed to a special audit by CAG proposed by the Government," he stated.<br /><br />"This totally unprovoked and unjustified attack on the credibility of the project, the Government of India and RIL by vested interests having little understanding of any mega project execution, leave alone complex deepwater projects in the E&P industry, has only strengthened our resolve and commitment to completely dedicate ourselves and our team of professionals to make the development of KG-D6 block an unparallelled success story for India," he stated.</p>
<p>RIL said capital expenditure for KG-D6 fields increased from USD 2.47 billion in 2003 to USD 8.83 billion due to a 2.5 times increase in reserves, trebling of production facilities, doubling of peak production, hike in number of wells, field life and inflation in equipment and services industry.<br /><br />Its President and CEO (Petroleum) PMS Prasad on August 20 wrote to Oil Secretary R S Pandey, saying "certain parties are bent upon holding the country's price and national interest hostage to their own narrow commercial interests and are stopping at nothing to destroy the reputation of the country."<br /><br />"It is necessary to nip these malafide endeavours in the bud for the sake of the energy security of the country," wrote Prasad and was a day later appointed to the board of RIL.<br />Without naming ADAG, he said the "unprovoked and unjustified attack on the credibility of the project" was being carried out by "vested interests having little understanding of any mega project execution, leave alone complex deepwater projects."<br /><br />Comparing with similar deepwater projects by world's top energy majors, Prasad said KG-D6's finding and development cost of less than USD 5 per barrel of oil equivalent was among the lowest in the world.<br /><br />"Ultimately cost and profit share in a Production Sharing Contract (PSC) regime are not dependent on capex estimates but have well informed systems of checks and balances to monitor actual cost recovery," Prasad wrote. "This includes tendering procedures, approvals by the Management Committee or the Government, statutory audits, and audit by the Government under the PSC."<br /><br />RIL stated that two independent experts appointed by DGH had validated the technical scheme for development and estimated capex as very competitive.<br /><br />"However, to demonstrate the transparency and openness of systems as operated by us within the PSC in accordance with the best international petroleum industry practices, RIL has also agreed to a special audit by CAG proposed by the Government," he stated.<br /><br />"This totally unprovoked and unjustified attack on the credibility of the project, the Government of India and RIL by vested interests having little understanding of any mega project execution, leave alone complex deepwater projects in the E&P industry, has only strengthened our resolve and commitment to completely dedicate ourselves and our team of professionals to make the development of KG-D6 block an unparallelled success story for India," he stated.</p>