The second performance audit of Reliance Industries Ltd (RIL)’s KG-D6, tabled in Parliament on Friday, has taken a lenient approach towards the country’s biggest private petroleum company. Taking a “pragmatic” view, the Comptroller and Auditor General of India (CAG) has recommended the government allow the company to recover $427 million in cost from the field’s natural gas production.

Cost recovery for $118.99 million on the remaining wells, however, has been disallowed. Besides, the well cost for D29, D30 and D31 would be disallowed if these aren’t found to be commercially viable, the auditor said.

Reliance Industries would fare comparatively better in an environment of falling oil prices because of its scale and complexity and its capacity expansion in the petrochemicals businesses over the next 12-18 months, analysts said.

The $10-billion petrochemicals expansion will help the Mukesh Ambani-led company to offset declines in refining earnings. Crude oil prices will impact Reliance Industries’ gross refining margin by at least $1.5 a barrel this quarter, said Phani Sekhar, fund manager with Angel Broking.

Hardy Oil, a partner of Reliance Industries (RIL) in the D3 block in the Krishna-Godavari (KG) basin, said on Thursday that it would review its investment in India in the light of unattractive pricing and uncertainty surrounding long-term price outlook for natural gas sales.

In a statement on its half-yearly results, Hardy Oil said the joint venture (JV) partners might have to relinquish portion of the block owing to Indian defence ministry's new policy on access restriction. It said India's Defence Research and Development Organisation has classified one-third of the D3 block as 'impact zone' and has imposed certain access restrictions to that area.

Reliance Industries (RIL) has contested Comptroller and Auditor General (CAG)’s draft observations on some payments the company made to contractors of KG-D6 fields, saying the auditor had not considered the contract requirement of factoring consequences of delays in procurement of goods and services on the project.

RIL, in a presentation at an Exit Conference called by CAG, at the end of its second audit of KG-D6 for 2008-09 to 2011-12, stated the auditor was using hindsight to question project efficiencies and procurements made eight years back.

Among the 124 global companies evaluated on various aspects of transparency, two Indian firms, Reliance Industries and Oil & Natural Gas Corporation (ONGC), were in the top 30 positions.

Transparency International, a non-profit organisation fighting against corruption and malpractices, gave Reliance Industries and ONGC ninth and 26th positions, respectively, in its latest report Transparency in Corporate Reporting. The report was released on Wednesday.

Reliance Industries said it planned to sell its share in the Eagle Ford Shale Midstream business in the US, which it has with a partner, Pioneer Natural Resources.

Reliance Holding USA, Inc owns 49.9 per cent of the EFS Midstream business and Pioneer holds 50.1 per cent.

Reliance Industries is looking to sell its 49.9 per cent stake in a US joint venture that owns a 460-mile pipeline network for transportation of shale oil and gas.

RIL, as well as its partner Pioneer Natural Resources Co, are seeking a buyer for their stakes in Eagle Ford Midstream venture as they focus on shale oil production.

Markets remained rangebound with negative bias in noon trades on Monday with auto shares leading the decline on the back of weak October sales while bank shares continued to trade firm.

At 13:00hrs, the 30-share Sensex was down 21 points at 27,845 and the 50-share Nifty was trading 8 points lower at 8,314.

State-owned Bharat Petroleum Corp Ltd aims to double its refining margins once it completes the expansion and upgrade of its Kochi refinery in Kerala to process high sulphur crudes by 2016, a senior company official said.

The refiner's margins dropped to $3 a barrel this year, from $4.50 to $5 a barrel last year, but levels will increase by a about $3 to $4 a barrel by mid-2016, said Neeraj Shukla, a chief manager at BPCL's refineries division.

The Central Bureau of Investigation (CBI) has begun a probe against four officials of market regulator Securities and Exchange Board of India (Sebi) in the Rs 10,000-crore Saradha chit fund scam.

According to CBI sources, three existing Sebi officials and one former official are being examined.

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