Thaindian News

Mumbai, Sep 24 (IANS) An Anil Dhirubhai Ambani group company Thursday said Reliance Industries (RIL) had no right to discontinue gas supply to its power plants as it was making payment according to the gas supply and purchase agreement (GSPA) price of $4.2 per unit.
Reliance Infrastructure also said the additional charge that RIL was levying on sale of gas from the Krishna-Godavari hydrocarbon basin as “marketing margin” was unauthorised.

The company was responding to an RIL statement earlier in the day that said gas supplies to Reliance Infrastructure’s power plant in southern India would be suspended as it had defaulted in payment during the first fortnight this month.

Countering the charge, Reliance Infrastructure, in a letter to RIL, said the Mukesh Ambani-led firm was “in violation of the executive decision of the government and in contempt of the order dated Jan 31, 2009 passed by the Bombay High Court” whereby it had been permitted to sell gas at $4.2 per mmbtu.

“We are making due payment of the sale consideration i.e. $4.2 per mmbtu for supply of gas under the GSPA,” said Reliance Infrastructure vice president Kamal Kant in the letter.

“The charge towards marketing margin is completely illegal (and) contrary to the provisions of the productions sharing contract. We are not liable to make payment of any illegal and unauthorised charge,” Kant added.

“Until this bonafide and genuine dispute with regard to the legality of the charge towards marketing margin is resolved, RIL is not entitled to suspend the operation of the GSPA or disrupt supplies,” he added.

“We are continuing to make payment of the lawful sales consideration at $4.2 per mmbtu and are entitled to receive uninterrupted supply of gas under the GSPA.”