RIL told to pay $1.55 billion

New Delhi: The oil ministry on Friday issued a notice of $1.55 billion to Reliance Industries and its partners BP and Niko for “unfairly enriching” by producing natural gas which flew from the adjoining oil fields of ONGC in KG basin.

RIL refused to accept any liability and said that it would issue a notice of arbitration to the government. It said that the claim of the government was based on “misreading and misinterpretation” of key elements of the production sharing contract and was without precedent in the oil and gas industry, anywhere in the world.

“According to the government, the contractor is restricted to producing only that quantity of hydrocarbon as they existed at the point in time when the PSC was signed. This approach overlooks the fundamental fact that at that stage, the work of exploration of the block has not even commenced.”