Released on = July 7, 2007, 4:20 am

Press Release Author = richa/newage pvt ltd

Industry = Advertising

Press Release Summary = rils fight 4 right

Press Release Body = Based on the argument of Ministry of Petroleum and public at
large that the pricing of gas should be market determined and not artificially
suppressed. Reliance had appealed to the division bench to overturn the order which
had in effect stalled gas projects thereby delaying nearly 50% of the Indian gas
requirement and undermining energy and security.
Reliance in its argument has conveyed to the High Court that it must be allowed to
negotiate with the buyers as gas cannot be stored and should not be flared in the
hope that Reliance Energy would one day set up its power plant.
Reliance indicated that the sole objective of Anil Ambani owned energy utility is to
procure gas by any means through media campaigns and misinformation and thereafter
sell the same to end users at a much higher rate and earn huge brokerage without
either setting up gas fields or putting up power plants. It is believed that Anil
Ambani group has assured Government that it has most of the approvals and plans
would be implemented soon. However, industry experts say that if Anil Ambani would
even try in all possibility, no power plant would be ready before 2012, while the
gas production from KG basin is expected to start flowing in less than a year if the
interim order vacated.
Interestingly the question on the ability of private companies in power sector for
setting up mega projects has been questioned as most companies including Anil Ambani
group had hardly contributed to additional capacity despite India facing crunch over
the last decade.
A senior petroleum ministry official also mentioned, under condition of anonymity,
that power companies who are lobbying through media and other forums for subsidized
gas price are adding Rs. 2.5 per unit to electricity cost at the consumer end due to
their transmission losses and in-efficiency and in effect gas price at Rs. 1.7 per
unit is only 2/3rd of the transmission cost. Any subsidized price for gas into a
system of in-efficiency, leakages and theft by design or otherwise would amount to
the Government rewarding the sector for its poor performance. Despite privatization
of power distribution in Delhi and other cities the performance and losses have
hardly improved.



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