New Delhi: State-run power generator NTPC Ltd plans to file a rejoinder in the Bombay high court stating that the government counsel’s statement in the gas supply case between Reliance Industries Ltd (RIL) and Reliance Natural Resources Ltd (RNRL) on Thursday was incorrect and that it has a “concluded” contract with RIL on the supply of gas from the latter’s blocks in the Krishna-Godavari basin.
The government had “intervened” in the dispute, and on Thursday, its lawyer T.S. Doabia said NTPC did not have a “concluded” deal with RIL.
This claim has significantly weakened the position of NTPC, which is fighting a separate case with RIL on the gas issue, which involves the supply of 12 million standard cubic metres of gas per day (mscmd) to NTPC for 17 years at $2.34 (Rs101.56) a million British thermal unit (mBtu).
No fuel: NTPC’s plant in Kawas, Gujarat. Expansion work at the plant as also at the company’s Gandhar unit has been delayed because of the uncertainty over gas supply.
“We have discussed this issue with our lawyer Ravi Kadam who is also the advocate general of Maharashtra. We will file the rejoinder shortly stating that we have a concluded deal with RIL. As far as we are concerned, we have got a strong case,” said a senior NTPC executive who did not wish to be identified.
Doabia declined comment.
Meanwhile, differences have emerged within the government on the issue.
“It has nothing to do with us. The government counsel intervened because of (the) ministry of petroleum and natural gas. Now, it if for NTPC to stick with its claim and we will go with NTPC,” said a senior power ministry official who did not wish to be named.
S. Sundareshan, additional secretary in the petroleum and natural gas ministry and its official spokesman, declined comment. M.S. Srinivasan, former secretary of the same ministry, said he would not comment on the case because he is no longer part of the ministry (he retired on 31 July).
NTPC, whose case with RIL dates back to December 2005, has always claimed it has a “concluded” contract with RIL on the gas from the latter’s blocks in the Krishna-Godavari basin. The gas was meant for two NTPC plants in Gujarat.
RNRL’s case with RIL dates back to November 2006 and the former has claimed that it has rights, courtesy an agreement signed when the Reliance group’s assets were split between estranged brothers Mukesh Ambani and Anil Ambani, to 28mscmd of gas from the latter’s Krishna-Godavari basin blocks and an additional 12mscmd if RIL’s agreement with NTPC breaks down, both at the same price at which RIL had agreed to supply gas to the state-owned power generator—$2.34 per mBtu.
RIL wants to supply the initial 40mscmd of gas from the blocks to buyers other than NTPC and RNRL.
The two projects of NTPC that the gas was meant for have been delayed.
Spokespersons for RIL and Reliance Anil Dhirubhai Ambani Group declined tocomment.
The government lawyer’s declaration has already been criticized by a minister in the United Progressive Alliance government who said it would “create a big stink” as reported by Mint on 22 August.
On Thursday, RNRL’s lawyers objected to the government lawyer’s claim.
Noted lawyer Ram Jethmalani said that the government could not say one thing in a case and something else in another. “(The) government seems to be more concerned with the private interest of RIL than the commercial interest of a government company. This is scandalous. This shows your government is corrupt.”
PTI contributed to this story.