NEW DELHI: Reliance Industries and its only customers on Monday failed to agree on the key terms of sale of natural gas from April 1 but the government asked the Mukesh Ambanirun firm to continue supplies on existing terms in the interim.
After an almost five-hour marathon meeting between RIL and urea companies, the two sides failed to settle on the rate at which gas supplies should be securitised.
The options were the rate of $4.2 per million British thermal units, which expires on Monday, or $8.34, the price that would have been applicable had the Election Commission not postponed implementation of the Rangarajan Committee formula till the completion of the general elections. RIL wanted the 16 fertiliser companies to financially secure payments for about 13 million standard cubic meters per day of gas they buy from its eastern offshore KG-D6 field at $8.34.
But the fertiliser units said that since the new rate is not applicable and the oil ministry had ordered the supply of gas at the existing rate while the model code of conduct is in place, they would provide letters of credit at $4.2Fertiliser secretary Shaktikanta Das, who chaired the meeting, said RIL will supply gas on the existing terms in the interim and a new Gas Sale and Purchase Agreement (GSPA) will be negotiated.
http://timesofindia.indiatimes.com/Business/India-Business/RIL-fertilizer-companies-fail-to-agree-on-supply-terms/articleshow/33049996.cms
After an almost five-hour marathon meeting between RIL and urea companies, the two sides failed to settle on the rate at which gas supplies should be securitised.
The options were the rate of $4.2 per million British thermal units, which expires on Monday, or $8.34, the price that would have been applicable had the Election Commission not postponed implementation of the Rangarajan Committee formula till the completion of the general elections. RIL wanted the 16 fertiliser companies to financially secure payments for about 13 million standard cubic meters per day of gas they buy from its eastern offshore KG-D6 field at $8.34.
But the fertiliser units said that since the new rate is not applicable and the oil ministry had ordered the supply of gas at the existing rate while the model code of conduct is in place, they would provide letters of credit at $4.2Fertiliser secretary Shaktikanta Das, who chaired the meeting, said RIL will supply gas on the existing terms in the interim and a new Gas Sale and Purchase Agreement (GSPA) will be negotiated.
http://timesofindia.indiatimes.com/Business/India-Business/RIL-fertilizer-companies-fail-to-agree-on-supply-terms/articleshow/33049996.cms