According to recent reports the energy giant Reliance Industries is going to suspend the Oil and Gas drilling due to the pending of an internal valuation of its production and internal valuation strategy. The firm is India’s most valuable company as it has a huge market capitalization. Reliance has witnessed a fall in its market value and its growth as the output in its gas fields saw a drop and the fields in the east coast have not been producing properly. Reliance has decided to halt the production until the review of the oil fields is completed and submitted to the Government. A Reliance spokesman when contacted by Reuters had declined to comment on the report. The Company controlled by billionaire Mukesh Ambani had posted its highest ever quarterly profits on Saturday. Though it was companies highest ever quarterly profits still the experts are focused on the slowing gas output and also said the refining margins were much below expectations.
In the previous month India’s upstream regulator said Reliance was producing 44 million standard cubic metres per day from the D6 block which was lower than the 60 million standard cubic metres per day it was producing a year earlier and far off a peak planned capacity of 80 million standard cubic metres per day. The CAG had also criticised Reliance and the Government for the development of the gas fields in the Krishna Godavari Basin and also called for a revamping of profit sharing arrangements from oil and gas blocks.
Bell The Bull says: Reliance Industries could witness loss in its market capitalization if the review is not a positive one