Anti-graft crusader feels vindicated

On the reported request of RIL for general amnesty scheme for oil and gas field operators, which would allow RIL to retain fields worth $10 bn-which the regulatory authorities want to surrender saying the contractor did not meet deadlines - E A S Sarma noted it would sound death-knell for the sanctity of sovereign contracts in India

Visakhapatnam: Former Union Energy Secretary Emani Ananta Satyanarayana Sarma, a known crusader against corruption, has at last seemed to have knocked at the right door. After writing as many as 11 letters to Prime Minister Manmohan Singh since 2009 on several irregularities of Reliance Industries Ltd., in the Krishna-Godavari Basin regarding exploration and pricing of natural gas without response, his complaint to the Delhi Chief Minister Arvind Kejriwal on the matter has worked, with the latter immediately firing a salvo against the UPA Government, ordering probe against Union Minister Veerappa Moily, former Minister Murli Deora, RIL Chairman and Managing Director Mukesh Ambani and others on Monday.

The complaint was filed by former Cabinet Secretary T S R Subrmanian, Admiral Tahiliani, former Navy Chief and noted lawyer Kamini Jaiswal along with Dr Sarma who took voluntary retirement in November 2000 – one year before it was due on superannuation, after he was vexed with the government enthusiasm to promote private corporates in violation of rules.

It was appropriate that Delhi filed the case since the cause of action had arisen in the nation's capital where the papers were signed in favour of the contract.

Dr Sarma, who has also taken up even local issues through Forum for Better Visakha since nearly a decade fighting against Coastal Regulation Zone (CRZ) violations and misuse of government lands, opines. RIL was benefited as the Ministry of Petroleum and Natural Gas (MPNG) decided to hike the natural gas price to $8 per million British thermal unit (mBTU) as against $4.2 from April 1 this year.

The former IAS officer says that the cost of production of natural gas from its fields in KG Basin is less than $ 1 per mBTU.

And why Arvind Keriwal? “I will be with anybody who is willing to fight against corruption,” he replies. In his letters to the PM, the former bureaucrat who was involved in preparing Union budgets in the past, wrote that during the last few years, the Ministry of Petroleum and Natural Gas (MPNG) had certainly not come out in any glory in its dealings with RIL. The MPNG ignored an indicated arms length price offer made by RIL to NTPC and fixed a higher price on erroneous considerations, he had pointed out. Once a scheme of gas development is found to be viable at a given price, there was no reason for MPNG to escalate that price to shield the franchisee company's shortcomings, he argued.

Subject to this, referring the issue of pricing gas to Rangarajan Committee had no sanction whatsoever under Article 21.6. Still, MPNG had nonchalantly gone ahead, determining the price on the basis of the recommendations of that Committee in violation of the Production Sharing Contracts (PSC). MPNG had no compunction whatsoever in retrospectively granting the benefit of the higher price to fields already under production. It was the Finance Ministry that reminded MPNG that it should act more on behalf of the public and less on behalf of the private company.

“An eminent Indian expert appointed by DGH came to the conclusion that RIL had faced no unusual geological surprises and the company failed to fulfill its obligation to drill the required number of wells as agreed. As a result, not only has there been a production shortfall but also a net loss in the recoverable gas resources causing a significant economic loss for the country,” Dr Sarma wrote in a letter to the Prime Minister.

Also, every time a Minister heading MPNG tried to protect the national interests, he would find himself shifted to an innocuous assignment, the bureaucrat who has settled in his home town of Visakhapatnam noted, obliquely referring to the latest case of Union Minister S Jaipal Reddy when the latter was shifted from MPNG.

On the reported request of RIL for general amnesty scheme for oil and gas field operators which would allow RIL to retain fields worth $10 billion-which the regulatory authorities want to surrender saying the contractor did not meet deadlines-he noted it would sound the death knell for the sanctity of sovereign contracts in India and erode the credibility of governance in the country. If the Union Cabinet were to consider granting any amnesty to RIL and others in the matter of PSC violations, it should know that such an amnesty would open the floodgates to contract violations across the board in different sectors.

The private players, either bound by existing contracts or who are intending to sign new contracts with the government, would treat all such contracts with utter disdain and contempt. The word would go round that sovereign contracts in India could be easily ignored by bribing public functionaries or influencing pliable politicians through other means. It would destroy the very fabric of governance in this country, especially at a time when the government is considering PPPs and JVs with private enterprise, he warned. Dr Sarma also in the past dashed off letters to the Chief Vigilance Commissioner on the reported linkes of Veerappa Moily with ITC and RIL, seeking probe.