Reliance Industries Ltd. (RIL) has asked fertilizer companies to provide payment security towards the differential between the previous price ($4.205 per million metric British thermal unit) and the revised price applicable from April 1 to keep the supplies intact.
“We have been supplying gas based on the terms offered in our letter dated April 1 pending the execution of Term Sheet provided by us. We once again request you to execute the Term Sheet provided and to provide us payment security without any further delay to enable us continue the supplies of natural gas,” RIL said in a letter to the fertilize companies.
“By a notification, the government has notified the gas price formula. Clearly, with effect from April 1 a revised price is applicable to all gas supplied by us and accepted by you,” the letter added.
But fertilizer company officials were baffled as to how much extra they would pay as the new price was yet to be finalised. On March 31 following several rounds of meeting, involving officials of ministries, RIL and fertilizer companies, it was decided that gas would be supplied at $4.205 per mmbtu till the new price was finalised.
But RIL said, “the description of what transpired at the meeting …is not accurate and does not capture the discussions at the meeting and which in any case were inconclusive. We deny that the sellers (RIL) agreed to the terms as suggested by you.”
As the election code of conduct came into effect last month, the government did not announce the new revised price leading to the disagreements.
