Petroleum ministry misleading PMO: Anil Ambani

Anil Ambani Group on Tuesday accused the petroleum ministry of "misleading" the Prime Minister's Office by claiming that Reliance

Industries is required to sell natural gas as per the Gas Utilisation Policy of the government.

The ADAG issued a statement on petroleum ministry's response saying the Production Sharing Contract (PSC) gives contractors freedom to market the gas. The PMO has sought comments from the oil ministry on a letter from Anil Ambani.

"Petroleum ministry is intentionally and deliberately misleading the PMO and public at large by claiming that PSC required RIL to sell natural gas as per the Gas Utilisation Policy of the Government," it said.

The ministry had in its response cited Article 21.1 of the PSC which states that "natural gas has to be sold as per the Gas Utilisation Policy of the Government".

An Empowered Group of Ministers, headed by the then External Affairs Minister Pranab Mukherjee that went into the whole issue of pricing and usage of RIL's KG-D6 gas for almost two years, approved a Gas Utilisation Policy and made allocations of gas among fertilizer and power firms.

ADAG, which is locked in a bitter dispute on sourcing of gas from Mukesh Ambani-led RIL, repeated its earlier stand that the petroleum ministry should terminate KG-D6 contract if it feels the PSC had been violated.

"If the petroleum ministry is firmly convinced of the facts, it is within their powers under the provisions of PSC to terminate the PSC it has signed with RIL," ADAG said.

Making a reference to the EGoM decision, the ministry told PMO that RIL's freedom to market as per the PSC is subject to the Gas Utilisation Policy and the pricing formula to be approved by the Government. "Under the PSC, RIL is required to sell gas as per the allocation decided by the Government keeping in view the sectoral priorities."

The ADAG stated that the "petroleum ministry seems to be suddenly realising the virtue of public interest at such a belated stage only to justify its action disregarding the fact that Bombay High Court allowed the Government to intervene in the matter keeping in mind the public interest."

The ministry in is response to the PMO stated that it had filed a Special Leave Petition (SPL) in the Supreme Court as the Bombay High Court order of June 15 "gives precedence to a private family MoU over the Government's right under the PSC, the policies approved by the Government and the Constitution of India".

ADAG said the petroleum ministry "was in full knowledge of the details of the gas supply arrangements between RIL and (ADAG firm) RNRL way back in June 2006, if not earlier. Copy of the gas supply agreement was duly submitted by us to the Petroleum Ministry in June 2006."