Archive for August, 2010

Nita Ambani: The business royalty of India

August 27, 2010

It’s incredible how many things a person can manage at the same time. From supervising the construction of a new wing at Mumbai’s Hurkisondas Nurrotumdas Hospital, run by a trust controlled by the Dhirubhai Ambani Foundation to making sure that the Mumbai Indians are in perfect shape for the Champions League; and all this while carrying a queen like grace all the time. Nita Ambani is in true sense a luminary of the business world.

Then there is the Dhirubhai Ambani International School (DAIS) as well, the project that is closest to her heart. Also, there are the affairs of the Dhirubhai Ambani Foundation, which she chairs, to go through. And, of course, the numerous family and other commitments that are part and parcel of being wife of Mukesh Ambani and the first lady of the RIL Empire.

Meeting with Neeta Ambani I hear is not the easiest of tasks. Many weeks and numerous calls later, one may be lucky enough to get a confirmation from her. So when you reach the clean, clutter-free and resplendent waiting room of her office, one cannot cease to wonder at the might of the Reliance Empire of which this may be a small yet significant part.

There are no hassles as with meeting with celebrities. No delays, No cancellations and definitely no last minute change of plans. Mrs. Ambani is a woman who respects time. Both hers and of others; and even while being in the midst of all the madness happening around her, Nita Ambani’s serenity is commendable.

“Everything at Reliance is always a bit of a whirlwind. So many things are happening all the time that you have to constantly shift focus,” she laughs, quoting the reason for all the wait and phone calls that had gone through to reach her.

Nita Ambani seems an accidental businesswoman. She got dragged into project execution almost two decades after she married Mukesh Ambani. Now she runs a not-inconsiderable enterprise with myriad activities. Most things she runs directly — the hospital and the school — are not technically businesses, unlike the Mumbai Indians franchise. But they are enormous and complex organizations nonetheless, employing hundreds of people.

They are private entities and trusts, so it is notoriously difficult to get an accurate handle on numbers. Intelligent estimates are, nevertheless, possible. It is estimated that over Rs 750 crore in revenues and over Rs 1,000 crore in annual investment budgets is being supervised by Nita Ambani which can definitely termed small.

While having the richest Indian for her husband, to being an idol in herself as well, Neeta Ambani will soon prove to be a valuable asset to even the reliance group which is headed by her husband, the mighty Mukesh Ambani. It would hence be quite interesting to witness the changes that Mrs. Ambani would bring along to reliance in case she thinks of joining in the brigade. But even for now, her efforts and accomplishments are the talk of the town and with her grace and business acumen, reliance industries limited may be well on its way to include hundreds of more ventures in the near future.


Krishna Godavari well drilling back on track

August 12, 2010

LONDON — Reliance Industries has resumed drilling of the KGV-D3-W1 exploration well on the KG-DWN-2003/1 (D3) license in the Krishna Godavarai basin offshore eastern India.

The Transocean rig Frontier 534 is drilling the well in a water depth of 1,653 m (5,423 ft), according to partner Hardy Oil & Gas. The target depth of the well, designed to test the hydrocarbon potential of Mio-Pliocene sands, is 3,514 m (11,529 ft) MD.

The KGV-D3-W1 was spudded April 2 by Transocean’s Deepwater Expedition, but had to be suspended at the end of May, at a depth of 2,608 m (8,556 ft) MD, due to an unresolved problem with the rig’s BOP control system.

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CAG completes RIL gas field cost audit; report to take time

August 9, 2010

NEW DELHI: Government auditor CAG said it has completed auditing the expenditure that Reliance Industries incurred in developing Krishna Godavari basin gas field D6, which was at the centre of an inflated billing controversy.

“The audit is complete at CAG end. We are currently in the final compilation stage after which the report will be sent to the Oil Ministry for comments,” a CAG official said.

CAG, which went into the $ 8.8 bn cost incurred by Reliance in producing gas from the nation’s largest field, had examined and received replies on its audit comments from the Mukesh Ambani-led firm.

“In another 30 days, we plan to send it (the report) to the Petroleum Ministry,” the official said.

When asked if Reliance had fully cooperated with the Comptroller and Auditor General (CAG) in submiting records pertaining to KG-D6 fields, the official said: “They have given, if not 100 per cent, but mostly what we wanted.”

The CAG plans to complete the entire audit process, which will include incorporating oil ministry’s comments on its findings, by November.

“In 3-4 months time, we will be done with the special audit report. Based on the ministry’s comment, CAG will decide the necessity of placing the report in Parliament,” he said.

Since the audit of KG-D6 is not a statutory audit, as is being done in case of public sector firms, the premier auditor would decide based on ministry’s comments on its findings if the report has to be placed in the Parliament.

“Our intention of the audit is to find out if there was any loss of revenue to the government because of any improper increase in capital expenditure in the KG-D6 fields,” he said.

Government is to get between 10 to 90 per cent of the revenue generated from sale of gas over the life of the field after deducting expenses incurred by the operator (Reliance).

“While it took a while to persuade the ministry for the CAG audit, it then took the ministry some time to persuade the companies as this audit was the first of its kind. So the delay of over two years,” he said.

CAG started audit of Krishna Godavari basin D6 field on December 21 last year. It, however, faced some difficulty in accessing new documets it sought after completing the first round of scrutiny. But within a month, RIL complied and the premier auditor made good progress thereafter.

Petroleum Ministry asked CAG to audit the accounts of RIL, which faced allegations of gold-plating gas field costs that has increased four-fold to $8.8 bn.

RIL had on August 17 agreed to an audit by CAG but the nation’s premier auditor could put its house in order for the audit only by December.

CAG’s scope of audit of PSC in respect of the block KG-DWN-98/3 (KG-D6) awarded to RIL, for two financial years – 2006-07 and 2007-08, with access to records of previous years linked to transactions of these years.