Supreme court rules in favour of GAIL

GAIL had offered to supply gas to GSPL at the pooled price but the latter did not agree and insisted on negotiation for the contract price of RLNG

GN Bureau | September 18, 2013



The supreme court overruled the Gujarat high court and has allowed GAIL (India) to go ahead with its decision to terminate contract with the state-owned oil and gas exploration company, Gujarat State Petroleum Corporation (GSPL), for providing natural gas imported from Qatar.

According to a news report in The Financial Express, a bench comprising justices GS Singhvi and V Gopala Gowda said that the high court should have relegated GSPL to the remedy of arbitration keeping in view the complex nature of the price fixation mechanism.

The apex court stated that the high court presumed that the negotiations held between the parties were not fair and that GSPL was entitled to the benefit of the policy decision taken by the centre despite the fact that it had not only challenged that decision but had also shown disinclination to accept the offer made by GAIL to supply gas at the pooled price and had insisted on mutually agreed price.

Writing for the bench, justice Singhvi stated that a reading of the draft re-gasified liquefied natural gas (RLNG) contract and price side letter sent by GAIL to the GSPL shows that GAIL had offered to supply gas to GSPL at the pooled price but the latter did not agree and insisted on negotiation for the contract price of RLNG to be effective from 1.10.2009.

GAIL had entered into a long-term gas sale agreement for 15 years in February 2004 with GSPC to provide gas till 2019. As per the contract, the price renewal for the gas to be provided from January 1, 2014, onwards was to be negotiated by the two parties by December 31, 2011.

 

 

Comments

 

Other News

Foundation of mine counters measure vessels command laid at Goa Shipyard

Goa chief minister Manohar Parrikar recently laid the foundation stone of the Rs 120 crore- MCMV (mine counters measure vessels) Command, Control & Design Office at Goa Shipyard Ltd, Vasco in Goa. The defence ministry has entrusted the GSL for series construction of sophisticated and hig

Sri Lankan defence secy reviews patrol vessel construction at GSL

A high level Sri Lankan defence delegation headed by secretary of defence, Kapila Waidyaratane PC recently visited Goa Shipyard Ltd. The delegation held discussions with GSL CMD, Rear Admiral (retired) Shekhar Mital. The defence delegation was shown the ongoing shipbuilding activities includ

Are our authorities callous when it comes to ensuring safety of people?

Are our authorities callous when it comes to ensuring safety of people?

Unto the first few

Our constitution promises equality of status and opportunity to all citizens but statistical data suggests that inequalities in wealth and income have increased since independence and are now on an uncontrolled upward spiral. Recently, Thomas Piketty and Lucas Chancel in their aptly titled s

NTPC seeks protection for Gadarwara project

NTPC has sought the help of Madhya Pradesh government for the safety of Gadarwara power project site and the workers who have stopped the work on the site since December 22. It has appealed to the local people to support the project of national importance. Half of the electricity generated

BHEL to set up supercritical thermal power project in Maharashtra

The Bharat Heavy Electrical Limited (BHEL) will be setting up a 660 MW coal-based thermal power project with supercritical parameters in Maharashtra. The Rs 2,800 crore-project will be built as an expansion project (unit 6) of Maharashtra state power generation company (MAHAGENCO)’s Bh

Current Issue

Current Issue

Video

CM Nitish’s convoy attacked in Buxar

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter