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Rediff.com  » Business » Gas to Anil firm if available: FM

Gas to Anil firm if available: FM

Source: PTI
May 14, 2010 19:14 IST
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The government on Friday said allocation of natural gas to companies like Anil Ambani Group's RNRL will depend on availability of the fuel after supplying to already designated users.

Allocation to new plants like Anil Ambani group's proposed power plant in Dadri, UP, would be made "when the gas will be available. I cannot be distributing a non-existing and non available resource," Finance Minister Pranab Mukherjee said here.

The comment comes within days of the Supreme Court upholding the government's sovereign right on gas, while giving its verdict on the four-year-old gas pricing and supply dispute between the group firms of Mukesh and Anil Ambani.

"We had already taken certain decision. Those decisions ought to the implemented... for certain sectors, we had indicated that gas will be available to you as and when you are in a position to take the gas (or) absorb the gas," Mukherjee said.

The Supreme Court had on May 7 rejected RNRL's plea for 28 mmscmd gas at $2.34 per million British thermal unit - 44 per cent lower than Government approved rates, for 17 years from RIL under a 2005 private family agreement between brothers Mukesh and Anil.

The court had asked them to renegotiate the deal in conformity with the government policy. Mukherjee, who headed ministerial panels that approved the $4.2 per mmBtu price for gas from Reliance Industries' KG-D6 fields, fixed its users and decided on the government's intervention in the Ambani gas dispute, welcomed last week's Supreme Court verdict establishing the government's right over the national resource.

"I am happy with the judgement because it clearly established the authority of the government" as the owner of the natural resource to fix price and users of the fuel as per national priorities, he told CNBC TV18.

An Empowered Group of Ministers, he headed, had allocated 64 million cubic meters per day of gas from KG-D6 fields to fertilizer, power, petrochemical, refineries and steel plants for five years to March 2014.

Another 30 mmscmd was given on temporary or fallback basis while the peak approved output from KG-D6 fields is 80 mmscmd.

The EGoM, he said, had decided that Anil Ambani Group's proposed power plant near Delhi would be allocated gas as and when it comes up.

Mukherjee said the EGoM had fixed price for five years and decided on users for all the gas for this period. After this period and upon increase in availability, a new gas price may emerge.

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