Reliance, BG lose India arbitration

Indian conglomerate Reliance Industries and the local arm of BG Group have lost a six-year old arbitration case worth up to USD 1 billion against the Indian government, local media reported on Tuesday.

The London-based UNCITRAL commission dismissed the two companies’ claims in a pricing and royalty dispute related to the development of the Tapti and PannaMukta fields off the coast of Mumbai, in which Reliance and BG hold a 30% stake each.

The decision comes after years of wrangling. On May 25, Bloomberg reported that the two companies were seeking to withdraw from the arbitration in order to take advantage of higher gas prices offered by the Indian government for deepwater exploration under a policy revision passed in March. In early September, however, Reliance decided to proceed with the case. According to media reports, it will now consider its future options following the decision.

Reliance has recently been seeking to expand and diversify its investment portfolio. On Monday, the India Times newspaper reported that the firm was seeking to buy six very large ethane carriers worth more than USD 600 million. They are to be the biggest such ships in the world.