Reliance Industries Ltd, operator of D-6 block, has approached the Supreme Court to appoint an arbitrator in the ongoing dispute with the Government.
Last November, RIL had sent an arbitration notice to the Petroleum & Natural Gas Ministry on the latter's intent to disallow some of the expenditure incurred by the company in the East Coast gas fields.
Following this, the Ministry had asked RIL to withdraw the notice on the grounds that the matter was premature. The Government also denied that there was any dispute.
In its petition, the company said that the Government's attempt to make the company withdraw its notice clearly shows that there is no scope of differences being settled amicably.
It also shows that the Government has no intent or willingness to negotiate or resolve the matter.
RIL had already nominated Mr Justice S.P. Bharucha, former Chief Justice of India, as an arbitrator and had asked the Centre to nominate a second arbitrator within 30 days from November 23, 2011.
This was based on the provisions of the production-sharing contract signed between the Government and the contractor.
The petition further states that the Government had initially sought an extension of time and then failed to appoint the second arbitrator even by December last year.
Reliance had sent an arbitration notice on the grounds that the move to recoup the expenditure is illegal as it is against the production sharing contract.
Earlier reports had indicated that $1.85 billion, out of the $5.69-billion investment, already made in the facilities will be disallowed by the Ministry and arbitration initiated to recover that from RIL.
Reports also suggested that the Ministry will be looking at disallowing $1.23 billion as cost recoveries for 2010-11 and 2011-12.
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