MoU inked is starting point: RIL
RIL told the Bombay High Court that the promoter members of the Reliance Group had entered into a mou at the time of demerger of the Reliance Group of Companies.
MUMBAI: Reliance Industries Limited on Thursday told the Bombay High Court that the promoter members of the Reliance Group, including Ambani family members, had entered into a memorandum of understanding at the time of demerger of the Reliance Group of Companies.
A Division bench of Justices J N Patel and K K Tated was hearing a case on the dispute between Anil Ambani-led Reliance Natural Resources Ltd (RNRL) and Mukesh's Reliance Industries over the supply of gas from K-G basin.
The MoU, signed on June 18, 2005, is the starting point and not a terminus for arriving at a suitable agreement between Mukesh's Reliance Industries and Anil's RNRL, RIL's counsel Harish Salve argued.
RIL is set to begin production of gas from the KG basin from September at the rate of 25 mn standard cubic meters per day which would go up to 40 mscm by March next year. The production is likely to go upto 80-120 mscm, said Salve.
RNRL, however, citing the family demerger agreement has claimed right over fixed quantity of gas for the plant at Dardi at a fixed price and not at market price.
Whatever has happened in the past, the two companies can still reach a suitable arrangement, Salve said, adding that interest of both companies was important and not just RNRL.
Millions of dollars are invested in the project and once the extraction starts, it cannot wait for a year. There has to be a continuous flow of the gas, Salve added.
RIL has invested about Rs 30,000 crores in the project, right from exploration to setting up the extraction plant.
RNRL's counsel, however, later told over the phone that the RIL had earlier refused to acknowledge the MoU.
According to the demerger agreement, based on the MOU, gas from the KG Basin has to be supplied to the government and then to RNRL for its power project, he added.
The court had earlier restrained RIL from entering into gas sales contracts with parties other than RNRL and state-run National Thermal Power Corporation (NTPC).
RIL had earlier entered into contract with NTPC for supply of gas but that has also run into dispute.
A Division bench of Justices J N Patel and K K Tated was hearing a case on the dispute between Anil Ambani-led Reliance Natural Resources Ltd (RNRL) and Mukesh's Reliance Industries over the supply of gas from K-G basin.
The MoU, signed on June 18, 2005, is the starting point and not a terminus for arriving at a suitable agreement between Mukesh's Reliance Industries and Anil's RNRL, RIL's counsel Harish Salve argued.
RIL is set to begin production of gas from the KG basin from September at the rate of 25 mn standard cubic meters per day which would go up to 40 mscm by March next year. The production is likely to go upto 80-120 mscm, said Salve.
RNRL, however, citing the family demerger agreement has claimed right over fixed quantity of gas for the plant at Dardi at a fixed price and not at market price.
Whatever has happened in the past, the two companies can still reach a suitable arrangement, Salve said, adding that interest of both companies was important and not just RNRL.
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Millions of dollars are invested in the project and once the extraction starts, it cannot wait for a year. There has to be a continuous flow of the gas, Salve added.
RIL has invested about Rs 30,000 crores in the project, right from exploration to setting up the extraction plant.
RNRL's counsel, however, later told over the phone that the RIL had earlier refused to acknowledge the MoU.
According to the demerger agreement, based on the MOU, gas from the KG Basin has to be supplied to the government and then to RNRL for its power project, he added.
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The court had earlier restrained RIL from entering into gas sales contracts with parties other than RNRL and state-run National Thermal Power Corporation (NTPC).
RIL had earlier entered into contract with NTPC for supply of gas but that has also run into dispute.
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