New Delhi, Oct 28 (Inditop.com) Anil Ambani-led Reliance Natural Resources Wednesday told the Supreme Court that the oil ministry was siding with Mukesh Ambani’s Reliance Industries to scuttle their pact for natural gas from the Krishna-Godavari basin at $2.34 per unit.
The allegation was made by Ram Jethmalani, senior counsel for Reliance Natural, before a three-member bench of the apex court headed by Chief Justice K.G. Balakrishnan, which is hearing the dispute between the two companies.
“I’m not saying this about the entire government. But your ministry (for petroleum and natural gas) is in conspiracy with Reliance Industries,” Jethmalani said, as the bench, which includes Justice R.V. Raveendran and Justice P. Sathasivam, was hearing the case.
“We can put it on record and file an affidavit stating this.”
His remarks came when Additional Solicitor General Mohan Parsaran, appearing for the oil ministry, wanted to stop Reliance Industries counsel Harish Salve from using its lawsuit against the state-run power utility as a case point.
Salve sought to impress upon the court that the price of $2.34 quoted for supplying natural gas to power utility NTPC, which is also under litigation, was arrived at on the basis of “competitive commercial pricing” through international bidding.
But in the case of Reliance Natural, he added, the price of $2.34 was a “concessional” one, and merely based on the price the company had proposed for NTPC and was not arrived at on the basis of a commercial decision.
At this juncture, Parasaran told the court that the issue of the gas supply to NTPC at $2.34 per unit was a matter of lawsuit, as Reliance Industries had backed out of the deal on the ground that it had not reached finality.
Jethmalani then responded with the allegation of collusion between Reliance Industries and the oil ministry.
During the marathon day-long hearing, the bench also quizzed Reliance Industries on various aspects of gas and asked if it would supply gas to Reliance Natural at $2.34 per unit if the Bombay High Court says it is a fair price in the case involving NTPC.
“Reliance Industries will go to the government and seek its approval,” Salve replied.
Counsel also said Reliance Natural was yet to have its power plant operational and so was not entitled to the fuel as the government’s gas utilisation policy says the supplies will be made only for power generation and fertilizer production.
The debate remained inconclusive and will resume Thursday, the day indicated by Salve to conclude his arguments.
The dispute is over the supply of natural gas from the Krishna-Godavari basin that was awarded for exploration and harnessing to Reliance Industries before a split in 2005 in the group founded by legendary industrialist Dhirubhai Ambani.
Based on a family reorganisation pact, the Anil Ambani Group wants 28 million units of gas per day for 17 years at $2.34 per unit. But Reliance Industries says it can only sell it for $4.20 per unit, claiming this was the price fixed by the government.
