Reliance can install compressor in D6 if it agrees to CAG audit: Oil Ministry

NEW DELHI: Reliance Industries ( RIL) will be allowed to install a compressor to increase gas recovery from its fields in the KG-D6 block if the company agrees to an audit by the Comptroller and Auditor General ( CAG), the oil ministry said on Tuesday.

The government has also asked the company to drill more wells in the fields to reverse declining output Minister of State for Oil and Natural Gas Panabaaka Lakshmi told parliament.

"The contractor's proposal to install compressor at onshore terminal to increase gas recovery from D1 and D3 fields has been approved by the management committee (MC), subject to contractor agreeing to CAG audit," she said in a written reply to a question.

Lakshmi said RIL had been asked to drill, complete and connect more producer wells and undertake remedial measures to revive the sick wells in D1, D3 and MA fields of the block.

Several other steps have already been taken to raise output, she said. The ministry had cleared RIL's revised development plan for MA oilfield, optimized field development plan (OFDP) of four new gas discoveries (D-2, 6, 19 & 22) in the D6 block and declared D-34 discovery commercial but, formal approvals withheld to put pressure on Reliance to accept CAG scrutiny, oil ministry officials said.

Official sources say that differences between the government and Reliance have been narrowed after the company recently agreed for CAG's financial audit as per the production sharing contract. Lakshmi said the average gas output from D6 block in the first seven months of the current financial year was 29.81 mmscmd.