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02-Jul-2009 12:22 - posted by Guest:
Taking strong exception to the Ambani family settlement setting the prices of a natural resource like gas, the fertiliser ministry. The ministry has also sought clarification from the oil ministry whether the Bombay High Court judgement to allot 28 million standard cubic meter per day (mmscmd) of natural gas from Reliance Industries’ KG basin to Anil Ambani-promoted Reliance Natural Resources Ltd (RNRL) would not affect gas supply committed to fertiliser units.
02-Jul-2009 12:23 - posted by Guest:
In a letter to petroleum secretary RS Pandey, fertiliser secretary Atul Chaturvedi said: “If such a private arrangement has implications on already signed GSPAs (gas sale-purchase agreements) for the allotted gas and if the existing rights of fertiliser companies are altered to their disadvantage, I am afraid they may also seek available legal remedies independently.”
02-Jul-2009 12:23 - posted by Guest:
ET Now first reported on June 25 that the fertiliser ministry would seek a clarification from the petroleum ministry as regards the court order. The fertiliser industry on Wednesday had voiced their worries on gas allocation to RNRL curtailing their supplies. The sector tops the gas allocation priority list. The oil secretary confirmed having received the letter. Declining to elaborate on the issue, Mr Pandey said: "Implications of the court’s judgement will be examined."
02-Jul-2009 12:24 - posted by Guest:
The gas policy, which was put in place soon after the government approved RIL’s price of $4.2 per unit as per a directive by the empowered group of ministers (eGoM), stipulates that fertiliser companies get the gas first, followed by power plants that are sitting on idle capacity for want of gas.
02-Jul-2009 12:24 - posted by Guest:
The policy has also served as the basis for providing gas to RIL’s first set of consumers. But it will not hold good if RIL gives the gas to RNRL. The court order directs RIL to sell gas to RNRL, which in turn will sell it to its affiliate, Reliance Power. At present, R-Power does not have any gas-based plant. Therefore, the company has two options: either use it as fuel for the proposed Dadri power plant, which is yet to come up, or to buy an existing one. And, selling gas to a new power plant is not allowed under the present gas utilisation policy.
02-Jul-2009 12:24 - posted by Guest:
Moreover, if RIL has to give 28 mmscmd to RNRL, it will be left with little gas from its first block of 40 mmscmd gas meant for existing fertiliser and power plants as mandated by the government. It is this contradiction that may force the government to step in. The government had earlier intervened in the dispute last October but withdrew two months later after the court directed that third-party gas sales could start. What is still unclear is how the government will intervene in the case, which is now likely to be taken to the Supreme Court.
02-Jul-2009 13:43 - posted by Guest:
Reliance Industries has decided to file an appeal in the Supreme Court against a Bombay High Court order that directed the Mukesh Ambani-owned company to supply gas from the Krishna Godavari basin to Reliance Natural Resources Ltd (RNRL) at a discounted price of $2.34 per million British thermal unit (mBtu).
02-Jul-2009 13:44 - posted by Guest:
The move, which has been anticipated since the court passed the order on June 15, came after Anil Ambani’s RNRL accused the Rs 1,46,291-crore oil and gas giant of violating the court order.
02-Jul-2009 13:44 - posted by Guest:
RNRL fired the first salvo today by writing a letter to RIL and accusing it of “wantonly defying” the court order.
02-Jul-2009 13:44 - posted by Guest:
The court had given the two sides one month’s time to come up with a reworked gas supply agreement. The new deal was supposed to guarantee RNRL 28 million cubic metres of gas a day for the next 17 years at a rate that works out to a 45 per cent discount to the government-mandated price of $4.20 per mBtu.
02-Jul-2009 13:45 - posted by Guest:
In an angry response, RIL said, “We do not concur with your interpretation of the findings ... and the question of deliberately, wantonly or otherwise defying the implementation of the order of the high court does not arise.”
