Author by Ankur Bansal. GSPC Discovers Gas That Was Never There. Maybe Pheku Was Planning to Fill in the Rest CAG’s report slams Gujarat government for massive Rs.16,706.99 crores irregularity This story is based on a report filed on the last day of the assembly session on March 30, 2012 and an expose by Tehelka. What happens when Gujarat discovers natural gas in the K G Basin between 2 trillion to 20 trillion cubic feet, worth more than 20 billion dollars, according to the Gujarat government? The Gujarat State Petroleum Corporation (GSPC) discovers an expert who can help it tap the reserves, named Jean Paul Roy, and gets into a tie-up with his company in March 2003. Where? In Guatemala of course! It’s so well-known for these famous characters. What name and how old is his company? GeoGlobal Resources was incorporated six days before the Joint Venture with GSPC. Where is it located? In Barbados, of course. There’s also a Mauritius connection later on, we will get to that. What experience does GeoGlobal have? No previous experience in disclosures to US authorities. How much capital does it have? $64 (Yes, sixty-four dollars). What stake does the GSPC give it? A full 10% share! By what process is the company chosen? Neither by a tender or any other transparent process. Around 20,000 crore rupees have already been spent by GSPC exploring. Of course, the Guatemalan fellow hasn’t coughed up 2,000 crores as his share. The Gujarati tax payer pays up! His share seems to be only in the profits and not in expenses. And what does GeoGlobal do for its 10% share? Precious nothing! The technical model it prepares is so deficient that Pheku has to spend 2.64 crore rupees on another expert. And on the basis of this GSPC contract, “GeoGlobal” then goes on to bag nine other contracts with the Indian government (mostly under the NDA regime). What is Roy meanwhile, doing? Starting another firm called Roy Group in Mauritius. Transfering 50% of his stake to the new company. Wheeling and dealing. Getting into a reverse takeover of a US firm, Suite101. And then became GeoGlobal Resources Inc., Canada. As a result of all the wheeling and dealing and sitting on top of 10% share in K G Basin, GeoGlobal rose from $0.01 a share in 2004 to $14.92 in 2006. K G Basin had already begun yielding 15,000 times returns to Roy, the Guatemalan, while it still to produce a single cubic foot of gas for us, Indians. Here are highlights from the Controller and Auditor General’s report: The CAG’s Problems with the Gas Deal Though the services of a technical expert could be measured in monetary terms, GeoGlobal was given 10 percent stake without any basis Geoglobal’s geological model had failed with respect to well depth estimate, its location and exploration cost estimates The technical modelprepared by GeoGlobal was so deficient that GSPC had to hire another technical expert at a cost of Rs 2.64 crore GSPC’s contention that GeoGlobal would not have agreed to do the technical evaluation without a stake that was not supported by any documents GSPC manipulated the cost of exploration and underestimated the cost of hiring a rig at the time of bid submission GSPC has suffered a loss of interest running into hundreds of crores of rupees by agreeing to contribute GeoGlobal’s share of 10 percent to the venture fund
Posted on: Fri, 23 Aug 2013 16:31:37 +0000
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