Sen on July 4 wrote to the Prime Minister that RIL and its Canadian partner Niko proposed a four-fold hike in capital expenditure on KG-D6 block off the east coast to 8.83 billion dollars while gas production is projected to only double to 80 million standard cubic meters per day from previous estimates.
"The proposal was approved by (upstream nodal agency) DGH with undue haste," the letter, sixth on the issue, said. "Clearly, the subsequent proposal of quadrupling capital cost for doubling the production defies the basic logic of economy of scale," it said.
DGH, he said, took 163 days to approve the original field development plan of 2.47 billion dollars, whereas the revised plan of 8.83 billion dollars was cleared in just 53 days.
"This reflects extreme haste, that too for a first-time deepwater development project in India, which smacks of deliberate complicity." Sen wanted the approval time for Reliance project be compared with the time taken by DGH for development plans of GSPC's KG basin project and Cairn's Rajasthan oil fields.
The act of artificial jacking up of capital expenditure in KG-D6 by RIL-Niko combine is having a direct bearing on the gas price that RIL is now pegging at 4.5 dollars per million British thermal unit, which is not favourable for power and fertilizer sector, he said.
