OREANDA-NEWS. We are saddened by the statement attributed to ONGC Chairman and Managing director Mr DK Sarraf by the Press Trust of India (annexed below) on Tuesday, May 20, 2014.

We deny the claim of apparent “theft” of gas from G4 & KG DWN 98/2 Block by Reliance Industries Limited (RIL) and can only attribute it to the likelihood of some elements in ONGC misleading the new CMD, Mr Sarraf, in order to hide their own failure to develop discoveries made over the last 13 years in these blocks.

ONGC approached RIL in mid-2012, to examine the possibility of sharing RIL's KG D6 infrastructure in order to commercialize some of the discoveries in these blocks and an MoU was signed between RIL & ONGC in July 2013. We continue to see ONGC as a valued Industry peer, worthy of collaboration, to whom we will continue to provide assistance to help develop its discoveries and start production of valuable gas locked beneath the Indian Ocean to the benefit of the people of India.

It was only in August 2013, that ONGC brought the issue of possible connectivity between reservoirs in RIL & ONGC blocks, to the notice of RIL through DGH. Since then, as per international practice, ONGC and RIL have been engaged in the process of appointing an independent agency to investigate the issue of possible reservoir connectivity across the blocks. The two had met on May 9, 2014 and exchanged drafts regarding the scope of work to be assigned to such agency. On May 23, the parties again met and finalized the enquiry notice to be sent to four agreed international expert agencies. It was decided to issue the Enquiry Notice on May 26, 2014. Since the process for appointing this agency as per international practice was already well underway it is indeed unfortunate that some elements in ONGC forced invocation of the Delhi High Court at this juncture.

Resolution of such complex techno-commercial matters, that are not un-common in the Oil & Gas industry, is best done through the help of experts rather than public posturing. In any case, ONGC having already filed a petition in the Hon'ble Delhi High Court, we would have expected greater restraint in a matter that has been made sub-judice by them.