Govt happy as SC says it owns gas

Last Updated: Friday, May 7, 2010 - 21:09

New Delhi: The government today welcomed the
Supreme Court verdict that upheld its right to fix price and
usage of gas, saying the fuel was a national asset that is to
be used for larger good of the people of the country.

Oil Minister Murli Deora, who faced flak for intervening
in the gas dispute between the Ambani brothers, welcomed the
Supreme Court verdict saying the government stand that gas
belongs to the nation has been vindicated.

Supreme Court said that the Ambani family MoU seeking to
divide gas between Reliance Industries and Reliance Natural
Resources Ltd was not binding, both legally and technically.

"I welcome the verdict. No matter what campaign one ran
against the government, the nation is supreme," he said
without naming Anil Ambani group which had cast aspersions on
his ministry for allegedly siding with Mukesh-led RIL.

The government last year moved the apex Court asserting
its sovereign right on pricing and utilisation, even as RIL
said that it had fixed the gas price at USD 4.20 per mmBtu as
per the government policy.

The government`s intervention in the case had made Deora
the target of attack with Anil Ambani group carrying front
page advertisements in newspapers, accusing his ministry of
trying to bailout RIL from its obligation under the Ambani
family MoU to supply 28 mmscmd of gas to RNRL at a price of
USD 2.34 per mmBtu.

Finance Minister Pranab Mukherjee said the judgement was
"good", while Power Minister Sushilkumar Shinde termed the
verdict as "fair", while making it clear that it has no
bearing on state-owned NTPC`s battle for gas with RIL.

The rate RNRL claimed is the same that RIL had bid in a
2004 NTPC tender to supply 12 million standard cubic meters
per day of gas to the state utility.

The contract for supply could not be concluded over
differences on terms and NTPC has dragged RIL to Bombay High
Court seeking performance of the contract.

"It has nothing to do with my case of NTPC against RIL.
No reference has been made on the dispute in the court
judgement," Shinde said.

He declined to comment on the supply dispute between RIL
and RNRL, saying it was a matter between two brothers.

When asked about the Supreme Court upholding government`s
right under PSC, Shinde said: "It is a fair decision."

Shinde said he was "part and parcel" of the ministerial
panels that first approved USD 4.20 per mmBtu price of RIL`s
KG-D6 gas, fixed priority and users of the fuel and then
decided to appeal against the Bombay High Court decision.

Law Minister M Verappa Moily said the verdict was
"vindication of the government`s sovereign and constitutional
rights" over natural gas resources of the country.

"Which side the judgement has gone? I am not making any
comment on that. But it is very clear that the stand, which
was taken by the government, particularly the Petroleum and
Natural Gas Ministry, has been vindicated and reiterated by
the Supreme Court," he said.

Minister of State for Fertiliser Srikant Jena also seconded Moily.

"The Supreme Court judgment in RIL-RNRL dispute has
re-affirmed the government`s stand that natural gas is a
national asset and the government is its legal owner," Jena
told PTI here.

"The verdict will provide more stability and
predictability to domestic gas prices in the country and boost
investors` confidence," he added.

The fertiliser sector will also stand to gain as it
already enjoys the highest priority in allocation of gas, he
said.

Former Petroleum Minister Ram Naik
today welcomed the Supreme Court ruling.

"When the New Exploration Licensing Policy (NELP) was
introduced by me as Petroleum Minister, we had very clearly
said that the Explorer will be the licensee and he will have
the freedom to sell the gas at market determined price subject
to the approval of the government as per gas distribution
policy," Naik said.

The private MoU would distort the marketing arrangements,
he said.

-PTI



First Published: Friday, May 7, 2010 - 21:09

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