Govt unlikely to claim power to price RIL gas

The government is unlikely to tell the Bombay High Court today that it has the power to decide the selling price of natural gas produced from Reliance Industries’ Krishna Godavari basin, going by its stated position in the Parliament so far. A division bench hearing the case had on Tuesday asked the government to give a clear ‘yes’ or ‘no’ on whether the Mukesh Ambani-promoted firm has the freedom to price its gas as it wants. The government counsel had sought time till Friday to file a reply. RIL’s case against honouring its gas supply contract with Anil Ambani’s Reliance Natural Resources Ltd (RNRL) would get a much needed shot in the arm if the government claims the right to price the gas. RIL stands to gain or lose more than Rs 77,000 crore from its two cases against RNRL and state-owned National Thermal Power Corporation (NTPC). The government’s stand on the issue in the Parliament has been that it does not interfere in the sale price of gas, but only approves the “formula or basis on which the prices shall be determined for the purposes of determining the government take.” “In terms of the provisions of production sharing contract (PSC) signed under the NELP regime, the government does not fix the price of gas,” minister of state for petroleum and natural gas Dinsha Patel had said in November last year: Six months later, Patel had reaffirmed this position when asked why his ministry did not respond to a request from the power ministry to intervene in the matter of non-supply of gas by RIL to NTPC.