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Heartburn over Ambani pacts

Mumbai, Feb. 9: The Ambani truce is looking ragged with the two sides beginning to shadow box over the provisions laid out in three agreements that the Mukesh group signed with the four companies that were spun off Reliance Industries Ltd (RIL).

The Anil camp ' which got control and ownership of the four companies after playing a game of legal brinkmanship in the space of two weeks ' has pored over the agreements and realised that the provisions in the pacts are loaded against it.

The agreements were signed with the companies on June 12 when they were still under the control of the Mukesh group.

The boards of the four companies ' Reliance Energy Ventures Ltd, Reliance Communication Ventures Ltd, Reliance Natural Resources Ltd and Reliance Capital Ventures Ltd ' have decided to “discuss and finalise appropriate amendments to all agreements with RIL”, sources in the Anil camp said today.

The Anil camp will press for a rollback of the provisions to ensure that the pacts are aligned with the agreed position on all issues that the warring factions reached on June 18, 2005. The Mukesh group refused to comment until they received a communication from the other side.

At the centre of the dispute is the gas supply pact that RIL has signed with Reliance Natural Resources Ltd. Under the agreement, RIL doesn’t have a firm commitment to supply the gas ' and even when it is in a position to do so, the first priority will be the supply to state-owned NTPC.

The sources said the Mukesh faction had excluded all future acquisition of blocks by RIL from an agreement to give the Anil group the first option to take 40 per cent of the gas. “This exclusion is a clear deviation,” they added.

The Anil camp says the broad understanding was that it would receive 28 million metric standard cubic metres of gas per day. The Mukesh camp says there is only an expression of intent. The uncertainty casts a cloud on Anil’s plan for a 5,600-mw power project at Dadri in Uttar Pradesh.

The Anil camp is also incensed over the way the Mukesh faction has kept the options open on entering airport infrastructure, an area that was demarcated for the younger brother.

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