Reliance Industries Takes on Government in KG Basin Gas Dispute
New Delhi: Once again, the Indian government has pushed back against Reliance Industries Ltd’s requests to delay hearings related to alleged gas theft from an ONGC block in the Krishna-Godavari Basin. The government is seeking $2.8 billion for this alleged wrongdoing.
During a hearing, Attorney General R. Venkataramani stated that the proceedings should go ahead without further delays, while a Supreme Court bench led by Chief Justice Surya Kant mentioned that they will wrap up the hearing but allow some time for both parties to consider a potential settlement. They advised Reliance to report any agreed resolution.
At the start of the session, Reliance’s attorneys, Sameer Parikh and R. Sasiprabhu, asked for more time to explore conciliation. Previously, Chief Counsel Harish Salve had requested a delay until July due to health issues, emphasizing his desire to argue the case, having previously represented Reliance in the arbitration proceedings that favored the company.
The Supreme Court had previously instructed Reliance to make alternative arrangements in Salve’s absence. Before the bench took on Reliance’s appeal—challenging a Delhi High Court decision that reversed earlier findings in favor of Reliance—senior advocate Mahesh Agrawal reiterated the request for an adjournment to allow for potential negotiations. However, the bench remained resolute about concluding the matter.
Senior advocate A.M. Singhvi, representing Reliance, argued that the High Court had wrongly intervened in a well-considered international arbitration decision, claiming that the flow of gas from the ONGC block was a natural occurrence. He pointed out that even if Reliance inadvertently took gas belonging to ONGC, the company had accounted for it and ensured the benefits went to the government, leading to no financial loss.
Singhvi highlighted that Reliance and its global partners invested a staggering $7.4 billion in natural gas exploration without any risk to the government. He noted that the government had benefited from $1.2 billion in royalties, profits, and indirect taxes, along with saving $13.7 billion in subsidy costs. He argued that even if the government’s claims about the alleged gas pilferage were accepted, the most they could rightly demand would be $105 million—far less than their current $2.8 billion request.
The debates will continue on Thursday as both parties prepare to present further arguments.
