RIL wants EGoM to give its views on gas allocation to NTPC - Fight against NTPC over their gas supply contract continues in Bombay HC

Mukesh Ambani controlled Reliance Industries might have had the upper hand against Anil Ambani group firm Reliance Natural Resources (RNRL) over the Krishna-Godavari basin D6 gas dispute, but RIL’s fight against NTPC, over their gas supply contract, continues in the Bombay High Court.It has learnt that RIL is seeking an expedited conclusion to the case and plans to approach the Bombay High court with its suggestions.

In 2003, Reliance won a contract to supply 12 million standard cubic metres of gas to NTPC for the expansion of its Kawas and Gandhar gas based power plants for $2.34 m British thermal unit, or BTU. But no formal contract was signed, only a letter of intent. NTPC says that Reliance subsequently didn’t honour that agreement, and took RIL to court.

It has learnt RIL is likely to request Bombay High Court to refer the dispute to the Empowered Group of Ministers on Gas pricing.

Reliance is likely to argue that its case is based on the Supreme Court verdict in the RIL-RNRL case where Supreme Court said that the government has the final say in decisions on gas pricing.

However, the government can ask Reliance to treat Public Sector Companies as special cases.

When contacted RIL refused to comment on the issue and said the matter is subjudice.

The original case when filed in Bombay HC was on the dispute of  the unlimited liability clause between RIL and NTPC which eventually boiled down to the issue of pricing with RIL saying even if there was a agreement with NTPC in the changed government policies it stands invalid.

So, it will now be interesting to see how the courts will treat this case on August 2 when it is likely to come up for hearing. Would the court treat this as a standalone case or would it link it to the SC verdict on the Gas pricing policy.