Will RIL earn profit by selling gas at USD 2.34? : SC
SC has asked RIL if it would make profit from selling gas at a price committed to power PSU NTPC, although it is lower than govt-approved price.
New Delhi: The Supreme Court today asked RIL
if it would make profit from selling gas at a price committed
to power PSU NTPC, although it is substantially lower than the
government-approved price, but there was no clear reply from
the Mukesh Ambani-led firm.
Hearing the arguments of Reliance Industries, represented
by counsel Harish Salve, the apex court raised the question:
"You had bid USD 2.34 per mmBtu (for NTPC), you would have
still made profits. Now when government is asking you to sell
gas at USD 4.20 per mmBtu, then you will get huge profits."
In its response, RIL said that the price of the gas would
not impact them as they are only recovering the cost and
thereafter government gets the lion`s share of profit.
The company also said that there is possibly no role for
Kokilaben in mediation of the dispute, as the issue involved
the production sharing contract and other technicalities.
The dispute pertains to RNRL`s demand that it be supplied
28 mmscmd of gas from RIL`s KG-D6 gas fields at a price of USD
2.34 per mmBtu agreed in a 2005 family MoU overseen by Ambani
family matriarch Kokilaben.
RIL, however, contends that it cannot do so in view of
the government policy, which in 2007 approved USD 4.20 per
mmBtu as price for KG-D6 gas.
Salve said: "If RNRL is asking me to give gas at a lower
price, then government will be debiting my account and I am
recovering a lesser amount... I have no control on gas, price
and choice of customers."