Prime Minister Manmohan Singh has constituted a four-member ministerial group to look into the dispute over natural gas from the fields of Mukesh Ambani-led Reliance Industries in the Krishna-Godavari basin and help in formulating the government's position on the matter before the courts.
Finance Minister Pranab Mukherjee will head the group, which includes Petroleum Minister Murli Deora, Power Minister Sushilkumar Shinde and Law and Justice Minister Veerappa Moily.
The decision was taken after a series of meetings the prime minister held on the matter with not just his colleagues but also the Ambani brothers - Mukesh and Anil.
One dispute over the gas is between Reliance Industries and Anil Ambani's Reliance Natural Resources, being heard in the Supreme Court, while the other is between the Mukesh Ambani firm and state-run power utility NTPC, which is being adjudicated in the Bombay High Court.
In June, the Bombay High Court asked Reliance Industries to supply 28 million units of gas from the fields to Reliance Natural Resources for 17 years at $2.34 per unit.
But Reliance Industries challenged the verdict in the Supreme Court, which heard the case July 20 and fixed Sep 1 as the next date of hearing. The court also asked all parties to file their replies on the government position on the matter by then.
Reliance Natural Resources on Tuesday accused the oil ministry of continuing "to misguide the people and key decision makers" including the Prime Minister's Office.
The next day, Petroleum Minister Deora met the prime minister for half-an-hour, during which he defended the government's intervention before the Supreme Court against the agreement between Reliance Industries and Reliance Natural Resources on distribution of gas.
According to a senior official in the oil ministry, Deora explained his ministry's position that the government had the right to determine the price and use of natural gas as it deemed fit.
Incidentally, the petroleum ministry has also filed a special leave petition in the Supreme Court with the plea that Krishna-Godavari gas was national property.