Reliance Industries Ltd (RIL) today told the Supreme Court that Reliance Natural Resources Ltd (RNRL) had agreed to the clause on ‘government approval’ (on gas sales) in the discussions that followed the demerger between the Ambani brothers, Mukesh and Anil.
The Anil Dhirubhai Ambani Group had recommended that the draft agreement of RIL with NTPC should be the basis of the gas sales and purchase agreement between RIL and RNRL, RIL counsel Harish Salve told the three-judge Supreme Court Bench headed by chief justice K G Balakrishnan.
The clause on government approval comes from the template (of the NTPC draft) which they (RNRL) recommended. Therefore, it should not be unreasonable to them (now), he said.
RNRL counsel Mukul Rohtagi told the bench that there are two options before the Court – either to remove hurdles in the gas supply agreement or to annul the scheme, which means going back to arrangements prior to demerger scheme of 2005. The second step would be ‘disastrous’ and nobody wants this step to be taken, said Rohtagi.
RIL and RNRL have moved the apex court against the June 15 decision of the Bombay High Court, which had asked RIL to provide 28 million standard cubic metres per day (mscmd) of gas to RNRL at a price of $2.34 per unit for its proposed power plant at Dadri. RIL, however, contends that it cannot do so in view of the government’s gas utilisation policy. It also said that it cannot sell at a price lower than the government-approved price of $4.2.