Essar Steel has moved to the High Court challenging the ministry’s decision to cut the supply of natural gas from the Reliance KG D6 fields to non core sector such as steel due to a fall in the output.

Senior counsel Mr Abhishek M Singhvi appearing for Essar Steel while asking for the court's approval to refer the matter before the EGoM said that "I am only asking for the matter to be referred to the EGoM meeting to be held on June 9th 2011."

He also added that the EGoM has consistently decided over such matters and so this aspect should also be decided by it.

Inclined upon the senior counsel’s suggestion to refer the matter to the EGoM, Justice Mr S Muralidhar said that "The better thing is that everybody should go to EGoM."

Additional Solicitor General Mr AS Chandioke however vehemently opposed the suggestion. He contended that the ministry of petroleum and natural gas has the authority to take decisions regarding supply and allocation of natural gas.

On the issue of prioritization of the supply of natural gas according to sector in the order fertilizers, LPG, power, city gas distribution, steel and so on, Senior Counsel Mr NK Kaul appearing for Essar contended that if the gas supply was reduced according to priority the company would not survive. He said that a proportionate cut shared by everyone was provided in the policy decision.

However, the ministry denied that there was any suggestion of a pro rata cut in the supply of the natural gas by EGoM. NTPC, who was allowed by the court to be a party in the case, also supported the ministry’s view.

(Sourced from www.lawetalnews.com)