Tuesday, August 25, 2009

NTPC SLP could be differentiator

In a dramatic decision, public sector power utility NTPC has decided to file a Special Leave Petition in the Supreme Court within the next few days. With power secretary H S Brahma confirming this development, NTPC despite the best efforts of the oil ministry to impede its progress in the matter is going ahead to secure its rights. Better sense has prevailed within the power as it goes out to protect its rights of procuring 12 million units of gas per day for a period of 17 years from RIL at the contracted price of $2.34 per million unit.

NTPC has been fighting a case in the Bombay High Court to get gas from RIL at the contracted price of $2.34, but RIL has reneged on this saying that NTPC doesn't have a concluded contract. This is an important landmark in the ongoing gas row because this will establish the floor price for gas at $2.34. The NTPC price became the basis of RIL-RNRL gas pricing for a similar period of 17 years. The oil ministry tried its level best to dissuade NTPC from doing the same, suggesting that the company wait for the outcome of its case against RIL pending in the Bombay High Court. Once the NTPC SLP is filed, it will become a unique quadrangular case with RNRL, oil ministry, NTPC and RIL in the apex court. RIL filed a SLP against RNRL verdict in Bombay High Court, oil ministry impleaded itself with another SLP and NTPC will now protect its interests with yet another SLP this time against RIL.

Fortunately the power ministry demanded that the oil ministry delete all statements that are injurious to NTPC's interest from its counter affidavit and SLP, filed in the SC cross appeals. The power ministry had identified 22 such paragraphs that were construed to be harmful to NTPC's interest. Finally victory for justice seekers and not those out to subvert the system.

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