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Allegations against Modi baseless, no GSPC decision was taken by government

Saurabh Patel: The allegations of gas not being there, the allegations of corruption are nothing else, but diverting attention from the existing charges of corruption against UPA

kg basin, gspc, gspc kg basin, kg basin gspc Saurabh Patel: The allegations of gas not being there, the allegations of corruption are nothing else, but diverting attention from the existing charges of corruption against UPA. (source: Express Archive)

This KG basin is a very difficult field where originally blocks were given to ONGC, GSPC and RIL. When we went for initial exploration we never knew we would have to go to such depths. We did not know that the pressure and temperature will be so high.

When we entered, when the expressions were done, the reserves came to be very good and we took the best advice of people in this field which was in Houston. After taking advice, we came to know that we have to go deeper. Everything which was done by us, in consultation with DGH (Director General – Hydrocarbons).

UPA approvals

There was a management committee formed by the UPA Government, which was headed by a joint secretary, petroleum. Now, every exploration result is scrutinised by this committee, and by DGH. After scrutinising the results they tell us to prepare the development plan.

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After the development plan has been laid, we submit it to them, there is a process. And in this process, the expenditure has also studied and quoted. The approval is given by them (the DGH) because if you look at the whole bidding process, the expenses are to be recovered from the gas which is being sold. So, if the expenses are high, naturally the DGH doesn’t give permission. Because there is a ratio in money and the sharing contract. So, after the recoverables the sharing contract falls in and everything falls in place. So, higher the expense, the money of the central government goes or the recovery starts late—that is the whole process.


Now, the rig, the platforms, the exploration wells, the processes of the exploration wells, the quantum of money, everything has been approved and reserves are in place, and have been shown to them (UPA). It is not that they are not aware of the reserves. Had it not been for the reserves, they would not have given the permission.

Tough well

Number 2, it is a tough well and that is the reason RIL (Reliance Industries Limited) went with BP (UK based BP Global). If you look at all Reliance Industries’ projects, this is the only project where they have given an equity to a company. Usually, they buy technology. Why did they go to BP? Because by this they were getting the best people. BP must have done a lot of analysis before jumping into this. Still, their production is on a reducing angle.

And they are spending a lot of money, on more on expression, because this is one of country’s biggest assets and it is very unfortunate that Congress is making allegations on the biggest of the country’s finds, which have been done during their regime.

Gujarat State Petroleum Corporation


If you look at GSPC’s performance records, being a state government company, their success ratio is better than average in the country. So, they saying that there is no gas — the allegation is completely false. Because, had there been no gas, why would the DGH management committee represented by the UPA Government’s joint secretary, (Petroleum) approve the same? So, the first allegation is wrong.

Second issue, that Modiji is involved — is all baseless. If you look at history of Congress in Government of Gujarat, they have always attacked Narendra Modi since last 10 years. And not a single issue, they have been able to prove. In this case, GSPC is an independent company. It is a company which has been run by board of directors and all board of directors, if you look at ten years’ records, are the finest directors. And the best of IAS officers which Gujarat can be proud of.

What I am saying is that the board of directors, the company, takes a decision and nowhere, not a single decision, has been taken by the government.

2G, Coal scam and KG basin


See, if you look at the difference, the 2G, the Coal Scam or this Agusta Westland Helicopters or whatever decision, they were taken by the government of UPA at that time. Over here, not a single file has been cleared by us. There are a lot of individual directors on board. And they will not take directions from the government.

In the Coal Scam, the government has taken decisions which have been contrary to the decisions of the bureaucracy, many a time. While in this case, we have not been involved. In GSPC government does not give approvals. Not a single block has been given approval by the government. Participating in this block or entering in is not a decision of ours, no way.

Geo Global Resources Inc

So, firstly, the gas is there. The contracts have been done as per the transparent policy. Tenders have been taken out, L1 (lowest bidder, in this case Tuff Drilling pvt ltd) has been given. If, any of the cases where L1 has not performed well, we have thrown out L1 with a penalty. As far as GeoGlobal is concerned, we have not paid him (Jean Paul Roy, director, President and CEO of Canada based Geo Global Resources Inc) anything.

He (Roy) came in as a technical partner, he did not perform, so we threw him out. The board members told us that. Tuff Drilling submitted a bid in July 2009, was awarded contract in 2010. Could not perform, so his bank guarantee for Rs 15.54 crore was encashed for non-performance. And L2 (Nabors) was given the contract in 2011.

But, regarding gas, why would BP join Reliance, if gas was not there?


We also wanted a technical partner. So, we opened up everything. But, at that time, markets were very good, and because the prices of gas were also very good, we asked for a good price from all these people (including BP). We discussed and decided we did not want to sell off such a good asset, not even a part of it.

We went for an IPO. And it is only because of Congress that the IPO did not happen. Because the Leader of Opposition at that time had sent an official letter to the Finance Minister at that time that state government or central government company should not participate. And an official letter was given. That was around 2010 something. It is on record. The Leader of Opposition himself has said that he had written a letter. And this has been widely discussed in the Assembly also.


So, the allegations of gas not being there, the allegations of corruption are nothing else, but diverting attention from the existing charges of corruption against UPA. They want to divert attention because, House is going on.

I also know what is the quantum of gas is coming, right now. But still I don’t want to say anything. Because right now also our people are very confident and they are working on it. Even today, gas is coming out. But we want that it is sustained and then we will declare.


Trying to demoralise the people who are working is not fair. So, our job in the government is to give them motivation. And it is not an easy thing, going and staying over there right in the middle of the sea.

Comptroller and Auditor General reports

CAG wants every company to get a return on equity whether it is a company supplying water pipelines or whateve. Objective of the government is not to make profit.

Saurabh Patel is minister, Energy & Petrochemicals, Finance, Mines & Minerals


First published on: 12-05-2016 at 19:39 IST
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