RIL cannot sell gas allotted to ADAG to another company: HC
04 May 2007
New Delhi: Anil Ambani-controled Reliance Natural Resources (RNRL) has secured an interim stay from the Mumbai High Court, which prevents RIL from selling 40 million standard cubic metres per day of gas, out of its estimated potential of 80 MMSCMD to any third party.
Mukesh Ambani-controlled RIL plans to appeal against the interim order in a division bench.
This has come as a first sign of hope for RNRL, which has been left without an effective fuel linkage for the proposed Dadri power project. Thursday's interim order restrains RIL from selling this gas to any third party or using it for its captive consumption.
RIL prefers to appeal to the Division Bench against this order.
RIL had entered into a contract with RNRL to supply 28 MMSCMD of gas to RNRL for its proposed Dadri power project in Uttar Pradesh. RNRL had a claim on an additional 12 MMSCMD of gas originally committed to NTPC, if the gas contract with NTPC failed to materialise, as per the demerger scheme that underpinned the parting of ways of the Ambani brothers.
The court order and the resultant litigation over the contract are likely to have an impact on RIL's work schedule. The company has been talking to consumers over the past few months to arrive at a price for the gas to be sold.
The gas contract between RIL and RNRL was signed at a time when RNRL was still controlled by Mukesh Ambani. Consequent to the approval of the demerger scheme by the courts, RNRL was handed over to ADAG.
Sources within ADAG alleged that the clauses in the gas contract were not in conformity to the demerger scheme. RNRL had moved the court in November 2006, seeking a stay on allocation of gas (committed to RNRL) to any third party.
