New Delhi: India has raised a claim of more than $30 billion against Reliance Industries and BP, accusing the companies of underproducing natural gas from a major offshore field and causing large losses to the government.
The dispute relates to the KG D6 gas block located off India’s east coast. The government says the companies did not extract gas as planned from the D1 and D3 deepwater fields, even though the production sharing contract required them to develop the reserves efficiently and in the national interest.
According to sources familiar with the case, India argues that key operational decisions taken by the operators led to a sharp decline in output and the loss of a large portion of the gas reserves. Initial estimates had placed recoverable gas at over 10 trillion cubic feet, but this was later revised down to around 3 trillion cubic feet. The government maintains that this revision does not remove the companies’ responsibility for the shortfall.
Reliance Industries, which operates the block, and its partner BP have rejected the claim. They say they met all contractual obligations and that the decline in production was due to complex geological conditions beyond their control. Both companies have largely kept details of their defence confidential because the matter is under arbitration.
The case has been before an international arbitration tribunal since 2016. Final arguments were completed in November this year, and a ruling is expected sometime in mid 2026. If India’s claim is upheld in full, it would be one of the largest financial claims ever pursued by the government against a private company.
Gas production from the KG D6 block peaked more than a decade ago and steadily fell before operations were halted in 2020. The outcome of the case is expected to have a major impact on investor confidence and future contracts in India’s oil and gas sector.
The dispute is being closely watched by the energy industry, as it could set an important precedent on how production commitments and reserve estimates are enforced in large offshore projects.