Reliance Industries' arbitration notice against the Oil Ministry's
decision to take away five of its KG-D6 block discoveries has become
invalid after the company failed to name arbitrators within the
stipulated time.
RIL and its partner Niko Resources had in February 2015 challenged the ministry's decision to take away 814 sq km of its eastern offshore KG-D6 area that contained five gas discoveries.
As per the dispute resolution mechanism set out in the Production Sharing Contract (PSC), an arbitration notice over a dispute has to be followed up within six months by naming arbitrators.
RIL and Niko did not name its arbitrator for the dispute, a senior government official said.
"So, technically the notice became invalid.
If the company wants to pursue the dispute, it will have to give a fresh notice and name an arbitrator," the official added.
Note
As per norm of giving up non-discovery area, RIL had in 2013 offered to give up 5,385 sq km out of a total 7,645 sq km area in Krishna Godavari basin KG-D6 block. But the ministry on October 30, 2013 ordered 6,198.88 sq km of total area to be taken away as the time allocated for producing from them had expired.
RIL on January 14 challenged this order as the 814 sq km of additional area that the ministry had taken away contained five gas discoveries holding close to 1 trillion cubic feet of reserves.
RIL and its partner Niko Resources had in February 2015 challenged the ministry's decision to take away 814 sq km of its eastern offshore KG-D6 area that contained five gas discoveries.
As per the dispute resolution mechanism set out in the Production Sharing Contract (PSC), an arbitration notice over a dispute has to be followed up within six months by naming arbitrators.
RIL and Niko did not name its arbitrator for the dispute, a senior government official said.
"So, technically the notice became invalid.
If the company wants to pursue the dispute, it will have to give a fresh notice and name an arbitrator," the official added.
Note
As per norm of giving up non-discovery area, RIL had in 2013 offered to give up 5,385 sq km out of a total 7,645 sq km area in Krishna Godavari basin KG-D6 block. But the ministry on October 30, 2013 ordered 6,198.88 sq km of total area to be taken away as the time allocated for producing from them had expired.
RIL on January 14 challenged this order as the 814 sq km of additional area that the ministry had taken away contained five gas discoveries holding close to 1 trillion cubic feet of reserves.
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