New Delhi, Dec 15 (IANS) Reliance Natural Resources Ltd (RNRL) Tuesday urged the Supreme Court to direct Reliance Industries Ltd (RIL) to furnish a bankable agreement on the supply of 28 million units of gas per day for 17 years at $2.34 per unit.
RNRL counsel Mukul Rohtagi also asked for directions from the three-member bench of the apex court to make the Mukesh Ambani-led RIL amend the “obnoxious and unilateral” gas supply master agreement thrust on his client Jan 12, 2006.

This gas supply agreement must be in line with the terms spelt out in the Ambani family business reorganization pact. It must also comply with the court-ratified scheme of business arrangement on the tenure, quantity and price of supplies, he added.

Rohtagi told the bench of Chief Justice K.G. Balakrishnan, Justice B. Sudershan Reddy and Justice P. Sathasivam that the family pact stipulated supplies of gas directly to Anil Ambani-led RNRL from RIL.

But RIL’s gas supply master agreement said it would supply gas directly to the affiliates of his client’s group companies. “This renders RNRL a shell company with no business.”

While nearing the completion of his argument on behalf of RNRL, the counsel also argued that the gas supply pact had wrongly provided for the government approval for the price of gas.

The family business reorganization pact, he said, had clearly held the price to be the same as that discovered by RIL in its international competitive bid to the state-run NTPC for the supply of gas — at $2.34 per unit.

Rohtagi asserted that the government approval was not necessary at all for the price of gas to be supplied to NTPC as well as RNRL.

He said the tenure of gas supplies in the pact was linked to complex and obscure conditions, while the family business pact and the court-ratified scheme clearly provided a period for 17 years for the supply of gas.

Similarly, the counsel said, the gas pact links the quantity of supplies to another complex and unworkable formula, while the family pact clearly provides for 28 million units to RNRL, and another 12 million units if the contract with NTPC fails.

Rohtagi also sought an amendment to the definition of the term “affiliate” in the gas pact and said a company like Reliance Power must be treated as RNRL’s affiliate, as RNRL has enough stake to control it.

The three-member bench has been hearing the dispute over the supply of 28 million units of gas for 17 years at $2.34 per unit to RNRL from the gas fields awarded to RIL.

The price, tenure and quantity were based on a pact in the Ambani family entered in 2005 but RIL later said it will only sell gas for $4.20 per unit to RNRL, claiming this was the consideration fixed by the government.

The Bombay High Court had earlier ruled in RNRL’s favour.