Vedanta Oil & Gas shares fell as much as 3.4% to their day's low of ₹33.66 on the BSE on Wednesday following the company's disclosure of two separate legal matters. According to The Economic Times, the decline reflects investor concerns over potential financial exposure from ongoing legal proceedings.
The company received demand letters from the Directorate General of Hydrocarbons (DGH) regarding four blocks awarded under the Open Acreage Licensing Policy (OALP) bidding rounds. As reported by The Economic Times, DGH has not granted further extensions for the four blocks and has sought payment of liquidated damages along with applicable interest. The total amount sought by DGH is approximately $35 million plus interest.
Separately, ONGC is pursuing enforcement of a $37 million arbitral award before the Delhi High Court. According to The Economic Times, this represents the second legal matter disclosed by the company involving state-owned oil and gas entities. The arbitration award enforcement adds another layer of legal exposure for the company.
Vedanta Oil & Gas believes it has valid grounds in both matters and is pursuing appropriate legal remedies available to address the legal challenges. As reported by The Economic Times, the company has requested DGH to refer the matter to the Committee for External Eminent Experts (CEEE) for resolution through conciliation or mediation. This approach suggests the company is seeking alternative dispute resolution mechanisms to resolve the payment disputes.
