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British energy secy meets Pradhan, discusses key issues

Last Updated: Friday, July 25, 2014 - 20:13

New Delhi: Weeks after Britain's BP and its partner Reliance Industries slapped an arbitration notice for delay in gas price hike, UK's Energy Secretary Edward Davey today met Oil Minister Dharmendra Pradhan to discuss outstanding issues.

After the meeting, Davey said British companies like Shell and BP are the largest investors in the energy sector in India.

"Lots of issues I raised (in meeting with Pradhan)," he told reporters here. "We have a very constructive meeting."

Asked if he raised the issue of delay in gas pricing reforms, he said, "We raised all the issues you might expect."

RIL-BP had last month slapped an arbitration notice for delay in contractual review of the price of gas from their eastern offshore KG-D6 fields.

The government last week decided to join the arbitration and named former Supreme Court judge G S Singhvi as its arbitrator. RIL-BP had named London-based Sir David Steel as its counsel.

RIL-BP want the government to honour its commitment and implement revised natural gas prices upon expiry of the USD 4.2 per million British thermal unit rate on March 31, 2014.

The previous UPA government had on January 10 notified a new domestic gas pricing formula that would have doubled the gas rates from April 1, but before it would announce the new price, general elections were declared.

The Election Commission asked the UPA to leave the decision to the new government and revision of rates was put off to July 1. The new government last month decided to defer a decision by a further three months pending wider consultations on the formula.

This is the second arbitration between RIL and the government over eastern offshore KG-D6 block. RIL had in November 2011 initiated an arbitration against government move to disallow recovery of certain costs over gas output from KG-D6 block not matching the targets.

"A delegation led by Edward Jonathon Davey, Secretary of State for Energy and Climate Change, United Kingdom, called on Dharmendra Pradhan here today. Both sides discussed the issue of enhancing the cooperation between the two countries in the energy sector," an official statement said.

The Minister, it said, invited the British companies to bring in investment and technology to various oil and gas sectors, like deep sea exploration, monetization of marginal and mature oilfields, laying of pipeline grid, and setting up of LNG terminal.

"Pradhan informed that the NELP-X (10th round of oil and gas block auction) would be launched, after carrying out the necessary modifications, and it is likely to attract a large number of foreign investors," the statement said.

Both sides agreed to enhance bilateral investments in the oil and gas sectors.

First Published: Friday, July 25, 2014 - 20:13
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