July 28: Anil Ambani today launched a ferocious attack on the petroleum ministry and Mukesh Ambani’s Reliance Industries Ltd (RIL), suggesting the two were conspiring to deny his claim to gas from the Krishna-Godavari basin.

Ambani blasted the petroleum ministry for its “biased and partisan” role in the dispute and for trying to become an interested party in a case now before the Supreme Court.

The younger Ambani scion said the petroleum ministry’s actions were motivated by “the sole purpose of attempting to bail out RIL and help them renege on their contractual obligations”.

Anil’s Reliance Natural Resources Ltd (RNRL) has been asserting its right to 28 million cubic metres of gas a day at a price of $2.34 per million British unit — which is at a 44 per cent discount to the $4.20 price set by an empowered group of ministers in September 2007. The company’s claim has been upheld by Bombay High Court.

“RIL has tried every trick in the book to back out of its legal and contractual obligations,” Ambani said, drawing a round of applause from the shareholders of RNRL, many of whom also hold shares in RIL — India’s largest private sector company.

Anil labelled RIL’s conduct in the gas supply contract as dishonourable: “…RIL has no morality in its headlong pursuit of corporate greed.”

The gas dispute between the Ambani brothers — two of the richest men in India — is moving towards its denouement with the Supreme Court due to start hearing the case from September 1. The case has all the makings of a cause celebre: a bitter war between siblings after the founder of India’s largest private company dies without leaving a will behind, the carve-up of the group’s assets, and a bitter court battle in which the government signs up as an interested party to protect its interests.

Anil did not name individuals but said the petroleum ministry had adopted a biased position on the gas dispute since 2006 when there was a change of guard in the ministry. That was the year Murli Deora, said to be close to Mukesh Ambani, took over as petroleum minister from Mani Shankar Aiyar.

“I am sure all private companies in India wish that if they made commercial decisions they wanted to get out of, they too had a saviour to help bail them out – as is apparently the case for RIL,” Anil told the shareholders.

Deora refused to join issue with Anil in public, saying: “I have no comments to make... as the matter is sub judice. All I can say (to Anil) is best of luck.”

Reliance Industries maintained silence in the face of the broadside. Finance minister Pranab Mukherjee this evening held a meeting with Deora and law minister Veerappa Moily.

“We are not partisan in the (RIL-RNRL) case … we moved (court) to protect the larger public interest. We can answer whatever is being said in the court,” said Mohan Parasaran, the additional solicitor-general who is representing the government in the case.

“I think we should have the decency to reserve our comments and let this case be heard by the Supreme Court instead of trying to create a public hysteria around the issues involved,” Harish Salve, counsel for RIL, told a television channel.

Sovereign rights

One of the key questions the case throws up is this: who owns the gas?

Anil said he was only staking claim to the gas that would legitimately go to RIL under the terms of the production-sharing contract signed with the government in April 2000.

He said the petroleum ministry’s intervention in the case would erode investor confidence and thwart the government’s efforts to attract investments into India. “Will this not set a precedent, allowing any ministry to alter contracts in the future at will?”