Centre tells Delhi high court ONGC has taken possession of Vedanta oil block
Mining company Vedanta had moved the Delhi high court's division bench, seeking to halt the government's takeover of the CB-OS/2 offshore oil and gas block.
State-run Oil and Natural Gas Corporation (ONGC) has taken possession of an offshore oil and gas block a day after the Delhi high court denied a 10-year extension of Vedanta Ltd’s production-sharing contract, the Centre said on Thursday.
Attorney general R. Venkataramani, appearing for the Centre, informed the court of this development during an urgent mention before a division bench led by Delhi high court chief justice Devendra Kumar Upadhyaya.
“There is no urgency in the matter. We have already taken possession. There is an affidavit on record," additional solicitor general Chetan Sharma, appearing for the Centre along with Venkataramani, told the division bench.
Mining company Vedanta had moved the Delhi high court's division bench, seeking to halt the government's takeover of the CB-OS/2 offshore oil and gas block. A day earlier, a single judge upheld the Centre's decision to deny the extension of Vedanta’s production-sharing contract (PSC).
Vedanta, which filed its appeal overnight, sought interim relief to restrain the Centre from transferring the block and to protect its operations. Taking note of the submissions, the chief justice agreed to entertain the appeal and directed that the matter be listed for urgent hearing before another division bench later on Thursday.
Vedanta was yet to respond to an email sent by Mint.
On Wednesday, the single judge dismissed Vedanta's challenge to the Centre's September 2025 decision rejecting its request for a 10-year extension under the 2017 PSC Extension Policy.
No automatic right
According to the judgment reviewed by Mint, the court held that while Vedanta's petition was maintainable, the company had no automatic right to an extension. It ruled that the Union government, acting as trustee of the country's natural resources under the Public Trust Doctrine, was entitled to consider not only a company's technical eligibility but also its conduct while deciding whether to grant an extension.
The court observed that private companies cannot hold the government to ransom in matters concerning the exploitation of the country's natural resources.
The court also upheld the government's reliance on Vedanta's unilateral deduction of about ₹88 crore from the government's share of profit petroleum towards its special additional excise duty (SAED) liability as a valid ground for rejecting the extension request.
The dispute relates to the CB-OS/2 offshore oil and gas block off Gujarat's coast, which Vedanta has operated since 1998 under a PSC with the Centre and consortium partners including ONGC.
Request rejected
The PSC expired in June 2023. Although Vedanta applied for a 10-year extension before the contract expired, the government rejected the request in September 2025, citing outstanding dues and non-compliance with policy. It directed the company to cease operations and hand over the block to ONGC.
Vedanta challenged the decision, arguing that it had applied for the extension well in time, that the government had continued to grant interim extensions while deciding the application, and that the dues were disputed and later paid under protest. The Centre maintained that an extension under the 2017 policy was discretionary and not a matter of right.
In January, the Delhi high court had directed both sides to maintain status quo, preventing the transfer of the block to ONGC during the pendency of the case. That interim protection ended with Wednesday's judgment, after which the Centre said ONGC had taken possession of the block.
About the Author
Krishna Yadav
Krishna Yadav is a Senior Correspondent at Mint, based in New Delhi, and part of the corporate bureau. He joined the newsroom as a trainee in 2023 and quickly grew into his current role. He writes on legal and regulatory developments in corporate India, with a focus on insolvency, taxation, company law, and policy. His reporting includes tracking and breaking key legal stories from the Supreme Court, Delhi High Court, NCLT, and NCLAT.
With a background in law, Krishna is known for simplifying complex legal developments into clear, accessible stories for readers. His work focuses on trends in corporate law and policy that affect businesses. This ranges from explaining tax disputes—like whether coconut hair oil is edible—to writing on why celebrities are seeking personal rights protection. He closely tracks India’s insolvency system, covering issues such as creditor losses, gaps in the process, and challenges in how the framework works in practice.
Krishna also tracks developments within law firms—covering hiring trends, how firms help companies navigate global challenges, and how the legal industry is adapting to artificial intelligence. Beyond legal reporting, he has written long-form pieces, including on-ground coverage of the 2024 general elections, capturing the scale and logistics of polling across India.
Outside work, he enjoys travelling, exploring new places, and reading about geopolitics and history.
Source: Livemint — Companies
