The Indian government has issued a $2.81 billion (approximately ₹24,500 crore) demand notice to Reliance Industries Ltd (RIL) and its partners, BP Plc and Niko (NECO) Ltd, over allegations that they gained financially from natural gas that may have migrated from an Oil and Natural Gas Corporation (ONGC) block into their own production field, as per the reports.

This move follows a February 14 ruling by the Delhi High Court’s Division Bench, which overturned an earlier arbitration tribunal decision that had exempted Reliance and its partners from liability. The Ministry of Petroleum and Natural Gas formally raised the demand following the court ruling, according to a stock exchange filing by Reliance.

What’s the dispute?

The conflict dates back to 2013, when ONGC suspected that natural gas from its KG-DWN-98/2 (KG-D5) and G-4 blocks was seeping into Reliance’s KG-DWN-98/3 (KG-D6) block in the Krishna-Godavari basin. ONGC claimed that four wells drilled by Reliance along the block’s boundary may have siphoned its gas reserves.

Following ONGC’s complaint, an independent study was commissioned by global consultant DeGolyer and MacNaughton (D&M), which in 2015 confirmed reservoir connectivity between the two blocks and quantified the volume of gas migration. This prompted the government to intervene and seek restitution from Reliance and its partners.

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