No loss to govt, RIL if gas is supplied at $2.34/mmBtu: RNRL
December 8, 2009
Anil Ambani-led Reliance Natural Resources Ltd (RNRL) on Tuesday contended before the Supreme Court that it has an “unqualified” right to get gas at $2.34 per unit for 17 years from Reliance Industries Ltd (RIL) which will, along with the government, not suffer any loss at this rate, reports PTI.
"There would be no impact on the government at all and it would suffer no loss whatsoever. RIL would also make a profit of Rs30,000 crore at this rate," RNRL said in an affidavit before a Bench headed by chief justice KG Balakrishnan.
"In case the government values the gas at $4.20 per mmBtu and RIL sells gas to RNRL at the price of $2.34 per mmBtu, the Government would still obtain its full share of the profit on gas," it said.
"RNRL submits that it has an unqualified right to get 28 MMSCMD for 17 years at the price of $2.34 per mmBtu," the company argued.
It pleaded that RIL is trying to inflate its profits by saying that the gas can only be sold at $4.20 per unit.
"The submission of RIL that the gas can only be sold at $4.20 per unit is only an attempt to inflate its profits. The government would obtain no additional benefit from such pricing and the net effect would only be enrichment of RIL," the company said in its four-page affidavit.
Raising objections on the government's stand that the arrangement for the supply and pricing of gas for NTPC cannot be equated with a private agreement between RIL and RNRL, the Anil Ambani group has accused the Centre of deliberately causing "confusion" and hurting the interests of State-run power utility NTPC Ltd.
The government had in its affidavit filed before the apex court on 2nd December argued that a private accord between RIL and RNRL could not be equated with that of any arrangement for NTPC.
The Ambani brothers are engaged in a bitter court battle over the supply and price of the gas from KG Basin. While RNRL is seeking gas at a committed price of $2.34 per unit, RIL says it cannot honour the commitment made in the 2005 family agreement due to government's pricing and gas policy. — Yogesh Sapkale