SC dismisses government request to stay sharing of documents

The case has its genesis in the government’s decision in disallowing the two companies to recover various costs amounting to $3.02 billion between 2012 and 2016.
Supreme Court ( Photo | Shekhar Yadav,  EPS)
Supreme Court ( Photo | Shekhar Yadav, EPS)

NEW DELHI: Reliance Industries and its partner for the KG-D6 block, BP Plc, have received some relief from the Supreme Court, which has dismissed an Oil Ministry petition asking for a stay on an arbitration panel’s order seeking several documents which form the basis for the $3 billion penalty imposed on the two oil and gas companies. The issue has been under international arbitration since 2015.  

The case has its genesis in the government’s decision in disallowing the two companies to recover various costs amounting to $3.02 billion between 2012 and 2016. According to the oil ministry, this penalty was levied because the ministry’s technical arm Directorate General of Hydrocarbons (DGH) felt that output in the KG-D6 block was lagging because the firms did not drill the number of wells they had committed to.

Consequently, a three-member arbitration panel was constituted in 2015 to hear the companies’ arguments against the government claim. This committee had then asked the oil ministry to furnish a wide array of documents, including those “sent, received or created” that “set out the reasons” for the government decision.

However, the Oil Ministry has opposed the request, arguing first at the Delhi High Court that the disclosure would raise confidentiality issues. But, the Delhi High Court dismissed the Centre’s petition in December last year, and the Supreme Court has now declined to do the same in a setback to the oil ministry.

“In the peculiar facts and circumstances of the case, we are not inclined to interfere with the impugned order(s). The special leave petitions are accordingly dismissed,” ruled a two-judge bench comprising Justices R Banumathi and A S Bopanna in early August.

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