C&AG slams Modi’s pet firm GSPC for gas fiasco

 

In July, 2005, as chief minister of Gujarat Narendra Modi announced a discovery of  an estimated 20 trillion cubic feet (TCF) of gas by Gujarat State Petroleum Corporation Limited (GSPC), a state PSU, in the Kakinada block of the Krishna-Godavari(K-G) Basin. It was estimated at that time  to value about $ 50 billion. Chief minister Modi described this as the country’s largest reserve of natural gas in the K-G basin.

The announcement shook the whole nation, even the then petroleum minister Mani Shankar Aiyar also fell victim to the Modi’s magical hype. Though experts like VK Sibal, the then director general, Hydrocarbons, Government of India, were skeptical about the tall claims, Modi described the finding as historic for India’s Hydrocarbon  sector and great leap forward for the country.

10 years on, there has been no major talks about the historic finding. Narendra Modi is now Prime Minister of this country. But,  the gas is not to be seen anywhere. This is not a charge leveled by any leader from the opposition. But an equally historic finding by the country’s premier audit agency Comptroller and  Auditor General  (C& AG) of India which securitized the GSPC’s performance.

The CAG slammed the ‘celebrated’ GSPC for its KG basin noise for the well is yet to produce the gas, a decade after Modi made ‘ historic ‘ announcement of the ‘country’s largest finding’. The C&AG noted that without any experience and expertise in exploration and production, the GSPC acquired many blocks and surrendered them later, leading to  writing off of a whopping sum of Rs 2,524,65 crore. ” The Company  went ahead acquiring overseas blocks during 2006-10 mainly as an operator with considerably high participating interests without  any expertise overseas,”  the report remarked.

Commenting on the performance of the GSPC, C&AG said,” the company’s borrowing jumped from Rs 7126.67 crore as  on March 2011 to Rs 19,716 as on March  2015, a jump of 177 per cent,”  while its interest burden rose to Rs 1804.06 crore  in 2014-15 from Rs 981.71 crore in 2011-12. C&AG submitted its report to Gujarat Assembly  on March 31, 2016.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s