RIL turns down gas supplies to new customers

Disregarding the oil ministry's directive, Reliance Industries has turned down natural gas supplies to new customers and continues to maintain supplies to power and fertiliser plants instead of cutting back to allow supply to new customers.
 
The company said the ministry's order violated the gas utilisation policy provisions and says it wants a panel of ministers to discuss the matter.

On 12 July the oil ministry had written to RIL asking it to make a "pro-rata" cut in gas supplies to all existing customers if the production from its eastern offshore KG-D6 fields was not adequate to service new customers like Essar Oil's Vadinar refinery.

On 15 July RIL wrote to petroleum minister Murli Deora saying it had not signed contracts for the supply KG-D6 gas with customers like Essar, as they were not ready to receive gas when available and so allocation made to them had lapsed.

There was no provision under the Gas Utilisation Policy as framed by an Empowered group of ministers, for reservation of gas and users the letter said.

"...all allocations that have not been signed on account of the customers not being ready to receive gas when available or lacking in the necessary pipeline connectivity cannot claim to have any quantity reserved for them," it wrote in the letter, a copy of which was also marked to finance minister Pranab Mukherjee.

RIL's KG-D6 fields can deliver only 60 million standard cubic meters per day against which the company has already signed or committed to sign gas sales and purchase agreements (GSPAs) for 57.8 mmscmd.