Delhi HC Rules Against RIL in $1.7 Billion Gas Dispute
In a significant ruling, the Delhi High Court has decided against Reliance Industries Ltd (RIL) and its foreign partners concerning a $1.7 billion claim from the Indian government. The court found that RIL had made “unjust enrichment” by extracting gas that migrated from the state-run Oil and Natural Gas Corporation (ONGC)’s blocks adjacent to RIL’s KG-D6 field off the coast of Andhra Pradesh.
Background of the Dispute
This case traces back to 2013 when ONGC asserted that its IG and KG-DWN-98/2 blocks shared a common gas pool with RIL’s KG-D6 field. The oil ministry approached the court after an arbitration panel dismissed its demand for nearly $1.6 billion, plus interest and additional cumulative ‘profit petroleum’.
Key Developments
The division bench of Justices Rekha Palli and Saurabh Banerjee quashed the earlier arbitration tribunal’s ruling that was in favor of RIL. They stated, “We are setting aside the impugned order dated May 9, 2023, and the arbitral award… being contrary to the settled position of law.”
The court highlighted that RIL’s extraction of gas from the common pool without proper compensation constituted unfair enrichment. This was supported by an independent study from US consultant DeGolyer & MacNaughton, which confirmed the continuity of the gas pool.
Looking Ahead
This ruling sets a precedent for future disputes in the energy sector, emphasizing the importance of fair compensation and transparency in resource extraction. For those interested in the latest deals and offers in the energy market, visit Looffers.com for exclusive promotions and updates.
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