Mukesh Ambani’s Reliance Industries and Anil’s Reliance Natural Resources Limited took yet another conciliatory step by signing the revised Gas Supply Master Agreement. This followed the direction of the Supreme Court on May 7, 2010.
In a statement on Friday, RIL said, “The gas supply master agreement (GSMA) is compliant with the gas utilisation policy and the empowered group of ministers’ decisions.”
The Supreme Court had asked both the brothers to rework their earlier family agreement.
RNRL in a disclosure to the stock exchanges said it “will now take appropriate steps to request the government of India for expeditious allocation of natural gas to facilitate implementation of the same.”
The GSMA had three main components, namely pricing, quantity and tenure. The pricing has been fixed by the government at $4.34 per unit, and the government will also decide how much gas will be given and for how long.
RIL is already supplying gas to the ADAG’s power plant in Andhra Pradesh at $4.2 per unit and it has one plant in Goa.
To qualify for the gas, ADAG firm will have to expand the plant’s capacity there. In the earlier agreement, the ADAG firm was to get gas at $2.42 per unit for 17 years.
Mukesh-led RIL later said that the government would decide the pricing and the quantity. The Supreme Court upheld this saying that gas as a natural resource belonged to the government which could decide pricing, etc.