Gas price too low even at $8.2 per unit, RIL tells SC

Reliance Industries Ltd, continuing its arguments in the Krishna-Godavari Basin case in the Supreme Court, today denied allegations of being favoured by a higher mandated price for gas under the Rangarajan formula, and said it will seek more than the recently granted $8.2 per mBtu during arbitration.

RIL's senior counsel Harish Salve argued that the company was ''honey-trapped'' into bidding for the gas reserves.

''It is like a honey trap where government says it will be market price if you discover gas or oil in any of the blocks and when you find it, it reneges on the contract,'' Salve argued.

He said it was not fair to change the rules after the bidding and it was not in the public interest either.

Seeking dismissal of the public interest litigations against RIL's contract for KG-D6, Salve said the issues raised were purely contractual between the company and the government.

The court will on Monday resume hearing the case, when Salve is expected to elaborate his arguments on Comptroller and Auditor General of India's report on KG-D6 (See: DGH failed to properly assess RIL gas discoveries: CAG).

Salve told the court that he had ''serious grievances'' against the CAG's audit report.

The apex court is hearing two petitions filed by the Prashant Bhushan-led Common Cause and Communist Party of India leader Gurudas Dasgupta (RIL case: Dasgupta asks SC to order auction of K-G gas block).

They have sought directions for a court-monitored probe into the ''collusion'' between the government and RIL and termination of RIL's gas production-sharing contract for KG-D6 and re-auction of the blocks.

They have also challenged the hike in KG-D6 gas price through the Rangarajan formula.

Denying all allegations, Reliance Industries has been crying foul over the CAG report, saying it was ''based on incomplete information'' and inferences were drawn either on presumptions or without domain knowledge.