In April this year Mukesh Ambani decided to auction gas from his gas fields, but it has taken the government four months to knock thirteen cents or Rs 5.25 off the price of gas that Reliance wanted. The Group of Ministers on Wednesday has set the landed cost of $4.2 per mmBtu gas which is 13 cents lower than the Reliance Industries original price. But Reliance sources have told that the consumers across India will need to pay more. For example in nearby Andhra Pradesh it will be around $4.7-4.8 per mmBtu. While in Gujarat and across the country it could be as high as $5.5-$6 per mmBtu, the formula will be valid for five years.
The EGoM formula does not apply to NTPC and Reliance Natural Resources Ltd which have sued Reliance because they already have contracted prices that are much lower for the gas.With the ministers coming out with the price formula, all attention shifts to the Bombay High Court which will take a judgment call on the contract dispute between RIL, NTPC and REL.
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