RNRL files caveat in SC on K-G gas deal

RIL may move apex court next week; Deora says govt’s active involvement is a must.

Anil Ambani-promoted Reliance Natural Resources Limited (RNRL) has filed a caveat before the Supreme Court to preclude the chances of an ex parte order (one issued without hearing the other side) on the gas-sharing deal it had signed with Reliance Industries (RIL).

Our Mumbai reporter adds: The move comes amidst reports that RIL is planning to move the apex court next week. There was also a buzz in Mumbai throughout the day that the RIL board met today to take a decision on the issue, though an official spokesperson of the company denied it.

RNRL filed the caveat after the Bombay High Court upheld on June 15 RNRL’s position on the gas price in its dispute with RIL and ordered that the Anil Ambani-led firm’s dispute with RIL over gas supply should be resolved within a month through a fresh “suitable arrangement”.

RNRL submitted that it should be given an opportunity to defend the matter before the apex court. After the Bombay High Court’s judgment on June 15, RIL lawyer Milind Sathe said filing an appeal in the Supreme Court is an option.

Meanwhile, Petroleum Minister Murli Deora told reporters here that the warring Ambani brothers had met him after the Bombay High Court’s June 15 ruling on the row. The government wants an early solution to the gas dispute as it cannot afford to lose revenues, Deora told reporters here.

“I am in touch with them (Ambanis). The brothers are ‘not very friendly, unfortunately’,” he added.

Asserting that nothing could be done on the Krishna-Godavari (K-G) gas dispute without the active involvement of the government, Deora said: “We are trying our best to find a solution to the gas dispute. In no way can the government afford to lose the money. We need the revenues from K-G gas for development of the country.”

He, however, declined to divulge details of his meetings with the Ambanis.

On Monday, the Bombay High Court had asked RIL to sell gas at $2.34 per mBtu (million British thermal unit) to RNRL. The price was 44.2 per cent lower than the land-fall price of $4.20 per mBtu derived by a government-approved formula. RIL has signed agreements with power and fertiliser firms to sell its D-6 gas (in the K-G basin) at this price excluding transportation charge.

RIL wanted the court to uphold the government-approved price, but the court sanctified the lower price of $2.34 per mBtu, which is stipulated in an agreement signed between Mukesh and Anil Ambani at the time of their separation in 2005-06.