New Delhi, Aug 3 (IANS): The government has recovered over a quarter of the penalty imposed on Reliance Industries Ltd for shortfall in gas production from the RIL consortium-operated KG basin fields in the eastern offshore, parliament was told on Monday
Petroleum Minister Dharmendra Pradhan told the Lok Sabha in a written reply that of the more than Rs.1,200 crore additional profit petroleum due from RIL, his ministry has recovered over Rs.350 crore.
"As a result of disallowance of a portion of contract cost,,contract is liable to pay additional profit petroleum of,$195.34 million (Rs.1,211.1 crore) to the government for the period up to the year 2013-14," Pradhan said.
He said that as per the mechanism for recovery, state-run GAIL has "despited Rs.367.86 crore towards the additional profit petroleum with Government of India till June 2015".
"Government has directed GAIL on March 2, 2015 to deposit the amount being credited to the gas pool account maintained by GAIL with effect from November 1, 2014, to the government's exchequer towards the additional profit petroleum of $195.34 million due and payable by the contractor," he added.
The government has effected recovery of the additional profit by disallowing the RIL consortium an increase in the new domestic gas price announced last November.
RIL has initiated arbitration against the government for the penalty imposed on the company, disputing the grounds of fall in output.
The arbitration is about allegedly failing to meet output targets from the Reliance-led consortium's specific offshore blocks. The government wanted the company to make good this shortfall vis-a-vis the terms of contract.
In response to another question, Pradhan said the foreign direct investment (FDI) in the petroleum and natural gas sector witnessed an almost 10-fold rise in 2014-15 as compared to the preceding fiscal, touching Rs.6,473.22 crore.
"There is highest investment in exploration and production of oil and natural gas, followed by refineries and marketing including pipelines network and LNG re-gasification infrastructure," the minister said.
In the petroleum sector, 100 percent FDI is allowed in exploration and production, refining by the private companies and marketing of petroleum products.