We will go back and renegotiate: RIL director

From getting the KG-D6 field up and running to making the rounds of courts in the bitter dispute over gas, RIL director and head of petroleum business PMS Prasad has been a key player in the Mukesh Ambani camp. In an interview with Jyoti Mukul, Prasad discusses the fine print of the Supreme Court judgment and what it means for the family memorandum of understanding (MoU). Excerpts:

How do you view the judgment?
I feel vindicated. This is something that we have been saying. Prima facie, we are okay with it. The court has accepted most of our contentions. (The) Government policy and production sharing contract (PSC) have been upheld. We have all along been saying that we have to follow the government policy. The production sharing contract gives us the right and it also gives a lot of rights to the government.

Is RIL open to renegotiating the family MoU?
The court has asked us to renegotiate the MoU within the ambit of PSC, government policy and decision of the empowered group of ministers (EGoM). We will go back and renegotiate.

What will you renegotiate?
One, the quantity (of gas for RNRL), which the government will allocate. The government has never refused gas to RNRL. It has said it will supply gas whenever the plant is ready. Second, the price which EGoM has fixed. The price will be the same for all. Then there is the tenure, which will be as per the development plan. I cannot sell gas to them beyond the tenure and prices determined by the government.

In that case, is there anything to renegotiate, since the price, tenure and allocation will be decided by the government?
We will look at the gas sale and purchase agreement (GSPA). There may be clauses other than price, tenure and quantity that may need to be renegotiated. There could be things like liabilities. It has to be studied. According to the order, it has to be non-discriminatory.

Currently, the GSPAs signed by RIL are for five years. Will RIL be in a position to enter into long-term contracts with the existing customers, now that it does not have to give 28 million standard cubic metre a day gas to RNRL?
The government has set the price of gas for five years. The GSPAs had to be co-terminus with the price. At the end of five years, gas supply will be at the rediscovered price.  Some of them may not like to buy gas if the price is revised. If the litigation had resulted in supplying gas to RNRL, then gas supply to them would have proportionately reduced. That clause will not kick in now. (The) GSPAs will need to be reworked, but they may not terminate.

Will the judgment have an impact on the RIL-NTPC case, especially the $2.34 price per million British thermal unit?
We will have to study the judgment fully.