The Ministry of Petroleum and Natural Gas has issued a demand notice of $2.81 billion (approximately ₹24,500 crore) to Reliance Industries Limited (RIL), along with its partners BP Exploration and Niko Resources, concerning a gas extraction dispute.
Background:
- In 2016, the Indian government alleged that natural gas had migrated from Oil and Natural Gas Corporation’s (ONGC) blocks to RIL’s KG-D6 block in the Krishna Godavari basin. Consequently, a demand of $1.55 billion was raised against RIL and its partners.
- RIL contested this claim, and in July 2018, an arbitral tribunal ruled in favor of the company. This decision was upheld by a single judge of the Delhi High Court in May 2023, dismissing the government’s appeal.
- However, in February 2025, a division bench of the Delhi High Court overturned the previous rulings, siding with the government’s stance.
Current Development:
Following the February 2025 judgment, the Ministry issued the $2.81 billion demand to RIL and its partners. RIL has stated its intention to challenge this judgment, asserting that it does not anticipate any liability from this case.
Conclusion:
This development marks a significant turn in the ongoing dispute between the Indian government and RIL regarding gas extraction rights and responsibilities. The outcome of RIL’s planned challenge to the recent judgment will be pivotal in determining the final resolution of this matter.
