PSU power major NTPC is likely to jump into the gas pool. The government's SG has advised NTPC to protect its rights by intervening in the pending RIL-RNRL dispute in the apex court. The SG believes that RIL should not be allowed to wriggle out of its written commitment and agreement between the parties to supply gas to Kawas and Gandhar plants of its share of gas at an identical rate of $2.34 per million unit.
This opinion has sent shockwaves in the RIL camp which was forced to file a caveat in the SC. NTPC floated a global tender for gas supply which was won by RIL at a competitive price of $2.34. This pricing became the basis of RIL's gas supply to the Dadri gas fired plant for which a fuel linkage company called RNRL was established. But on June 17, 2005, a day prior to the family MoU between the two Ambani brothers, RIL summarily pulled out of the gas supply agreement with NTPC citing unconcluded contract, triggering off a massive legal dispute between RIL and RNRL on one side and RIL and NTPC on the other. SG's views if accepted will see NTPC intervention in the pending cross appeals.
Strangely the power ministry under whose aegis NTPC comes has kept silent on this controversial issue. NTPC contract with RIL gives it 12 million units of gas per day at $2.34 for a period of 17 years. RNRL's subsequent contract gives its 28 million units at the same price for the same tenure. But RIL refuses to give it to either party and wants to appropriate it for itself. Letting the oil ministry and DGH to fight its battles and hiding behind the national resource plea.
Sadly it doesn't wash in a court of law.