CAG raps DGH, govt. for not collecting dues

The CAG has pulled up the Director General of Hydrocarbons (DGH) and the Petroleum and Natural Gas Ministry for failing to collect dues worth over ₹3,600 crore from contractors who relinquished blocks allocated to them for oil and gas exploration.

Contractors awarded exploration blocks under the New Exploration and Licencing Policy (NELP) are required to pay the cost of unfinished minimum work programme if they relinquish the block or the contract is terminated by the government.

Contractors of 54 relinquished blocks failed to pay dues as specified in the production sharing contracts, as per a CAG audit.

An amount of $510.79 million (₹3,652.64 crore) remained uncollected on this account with respect to 45 blocks out of total dues of $ 664.67 million or ₹4,753 crore.

For nine other blocks, the cost of unfinished minimum work is yet to be worked out by the DGH or approved by the petroleum ministry. The DGH, the CAG pointed out, has not been abled to finalise benchmarking rates for costs or build a databank till September 2019 though this was required as per government policy laid down in 2007.

“Non-maintenance of cost data by DGH… resulted in multiple and prolonged communications for seeking/ collection of information and data from the contractors by DGH,” the CAG observed.

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