Niko Serves Arbitration Notice to Reliance, BP
Canada’s Niko Resources has served an arbitration notice to its KG-D6 block partners, India's Reliance Industries (RIL) and BP, the Indian company said January 18 in its quarterly (3Q2019) results statement.
According to RIL, during the quarter, Niko defaulted on cash calls and accordingly default notice was issued as per the provision of joint operating agreement (JOA). “Since Niko did not cure the default within the default period, RIL and BP issued notice to Niko for withdrawal from production sharing contract (PSC) and JOA and assign the participating interest to RIL and BP. In response to the notice, Niko has served notice of Arbitration,” RIL said.
Niko has a 10% stake in the KG-D6 block; RIL owns 60%, while BP has a 30% interest.
According to RIL, KG-D6 field produced 6.08bn ft3 of natural gas in 3Q, a reduction of 62% on year. There was no crude and condensate production. KG-D6’s output has been falling consistently in recent years.