Gas supply pact not in consonance with family agreement: RNRL | business | Hindustan Times
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Gas supply pact not in consonance with family agreement: RNRL

business Updated: Dec 15, 2009 20:47 IST
HT Correspondent
HT Correspondent
Hindustan Times
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Anil Ambani-led RNRL on Tuesday accused RIL in the Supreme Court of unilaterally inserting provisions in the agreement for gas supply, saying it went against the family MoU of 2005 providing for fixed quantity of gas from the KG Basin.

RNRL contended that the provisions of Gas Supply Master Agreement (GSMA) was unilaterally formulated and signed at the controversial board meeting of RIL on January 12, 2006.

Raising six objections to the GSMA, RNRL's counsel Mukul Rohatgi said it reduces the tenure of gas supply to one to four years from 17 years as envisaged in the 2005 MoU.

He said the complex price formula would render the contract completely unbankable.

He submitted that GSMA was against the interest of ADAG as it provided for gas supply directly to the affiliate of RNRL which owns the power plant. “In such a case, RNRL will not be the buyer but its affiliate Reliance Power Ltd (RPL) will be the buyer and RIL will be the seller. This renders RNRL a shell company with no business,” Rohatgi said.