Giving a big relief to Reliance Industries Ltd, the Oil Ministry has agreed to the company's plans to raise natural gas production from the flagging KG-D6 without any need to get a performance audit by the Comptroller & Auditor General of India (CAG).

In a letter sent to RIL, the Oil Ministry stated that all the government nominees on the Reliance-operated KG-D6 block oversight committee had approved all the development proposals made by the company.

The ministry also stated that CAG would not carry out a performance audit of the operator; rather it would be a financial audit.

In the letter, the ministry wrote, "The proposed audit would be under Section 1.9 of the Accounting Procedure of the Production Sharing Contract, and not a performance audit of the operator (RIL)."

Previously, the ministry had been holding back approvals to the company's investment plans as the company had not been allowing the CAG to do a second round of audit of KG-D6 block for a period of 2008-09 to 2011-12.

RIL had been insisted on the condition that the national auditor would perform audit as per provisions of the agreement and that it would not inspect books for period of 2008-09 and 2009-10.

The recent approval from the Oil Ministry will now let RIL to implement urgent remedial measures at KG-D6 block, where production has dropped by more than 55 per cent over the last two years to around 26 million standard cubic meters a day.