RNRL seeks to make NTPC party to its gas case against RIL

Anil Ambani group firm Reliance Natural Resources Ltd (RNRL) asked the Supreme Court on Wednesday to make state-run NTPC Ltd a party to its ongoing case against Mukesh Ambani-led Reliance Industries Ltd (RIL) .

Alleging that RIL was trying to wriggle out of gas supply contracts with NTPC and itself, RNRL said, RIL had adopted the same mala fide design of inserting unsuitable terms in the respective gas supply agreements with RNRL and NTPC to renege from its binding obligations. This was as a result of pure commercial greed in as much as the gas prices had started rising.


Both RNRL and NTPC are seeking gas from RIL’s Krishna-Godavari D6 oilfields at a price of $2.34 per million British thermal units (mmBtu), while RIL argues that the price needs government approval.

RNRL and NTPC are taking the same stand to oppose the dishonest stand taken by RIL to avoid its obligation to supply gas to both the companies, the application by RNRL said.

The Supreme Court is to commence final hearings on the matters on 20 October.

RNRL’s application added that the state-run power producer had also stated in its petition that the decision of the empowered group of ministers (on price approval) was without prejudice to the pending proceedings in RNRL and NTPC cases.

Both NTPC and RNRL have taken the stand that RIL’s commitment is not affected by any decision by the government on gas utilisation or price and that the supplier was bound to give the public sector company gas at a price of $2.34 per mmBtu for a period of 17 years.

RNRL said RIL was seeking to deny supply of gas on the ground that the gas utilisation policy announced by the government in 2008 overrides the existing contracts.

It is submitted that in case it is held that the existing contracts are over-ridden by gas utilization policy or RIL is entitled to supply gas only at the price approved by the government, the suit filed by the NTPC would be rendered infructuous and NTPC would suffer a loss of over Rs30,000 crore, the application said.

RIL, meanwhile, cautioned that NTPC should not make comments on matters under consideration by the courts, lest they be construed as an attempt to influence the outcome of its court case seeking natural gas at the price committed in 2004.
SOurce: livemint

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