Reliance in arbitration with the government

Former UK judge Sir Bernard Rix, who recently retired as Lord Justice of Appeal with 20 years experience in the Commercial Court and the Court of Appeal in London replaces former Chief Justice of India S P Bharucha as the arbitrator in the KG-D6 cost recovery dispute by Reliance Industries. Bharucha quit after the government challenged his nomination on the grounds that he did not disclose his previous associations with Reliance Industries.
To arbitrate on the issue of whether the government was correct in disallowing over USD 2.3 billion of KG-D6 cost as output lagged targets Rix will sit on a three member panel which will be headed by a former Judge of an Australian High Court, Michael Kirby who was appointed by the Supreme Court as a neutral arbitrator. Chief Justice of India V N Khare is the arbitrator for the government on the panel.

In the beginning the Government of India did not participate in the arbitration within 30 days as per the Production Sharing Contract (PSC). However when Reliance moved to the Supreme Court for the second arbitrator to be appointed, the Government accepted. However Justice Bharucha and Justice Khare could not come to a consensus on the third arbitrator for 13 months. Thus on August 8, 2013 Reliance again moved the Supreme Court on this matter.

Former Australian judge Michael Hudson McHugh was initially named as the presiding arbitrator however the SC in September appointed retired judge Michael Kirby to chair the arbitral tribunal.

On the matter of the delays in approving revision in KG-D6 gas price the company has filed a separate arbitration on May 9th. For this Reliance named Sir David Steel as its arbitrator and the government named Justice GS Singhvi as theirs. The two have not been able to decide on the third arbitrator and a petition has been filed before the SC for the appointment.