NIKO Serves Arbitration Notice On Reliance, BP
Niko Resources has served a notice of arbitration on Reliance Industries and BP Plc after they asked the Canadian oil and natural gas company to exit the KG-D6 block because it had defaulted on cash calls, RIL said in its earnings statement.
Niko owns 10% participating interest in the KG-D6 block off the eastern coast that has a bunch of depleting fields as well as some promising ones being currently developed. RIL owns 60% interest in the block while BP holds 30%.
During the October-December quarter, M/s Niko (NECO) Ltd defaulted on cash calls, which triggered a default notice, RIL said.
“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 joint operating agreement (JOA) and assign the participating interest to RIL and BP,” the company said. Niko responded by serving a notice of arbitration.