Delhi High Court Stays Government's Takeover of Vedanta's Offshore Block

The Delhi High Court has ordered a temporary halt to the Indian government's decision directing ONGC to take over an offshore block from Vedanta Limited. This decision follows Vedanta's challenge to the denied extension of its Production Sharing Contract, citing arbitrary government actions and a lack of fair hearing.

In a significant legal development, the Delhi High Court on Wednesday intervened in the ongoing tussle between the Union government and Vedanta Limited by ordering the maintenance of status quo on a contentious Production Sharing Contract (PSC) pertaining to offshore oil operations.

The Union government's recent decision, dated September 19, 2025, had denied Vedanta an extension of its PSC for the CB/OS-2 offshore block off the Gujarat coast, necessitating an abrupt takeover by the state-run Oil and Natural Gas Corporation (ONGC). Vedanta strongly contested this move, alleging arbitrary action and a breach of procedural fairness.

Senior advocate Mukul Rohatgi, representing Vedanta, highlighted that issues like audit objections and profit discrepancies had not been previously raised, challenging the legality of such an unforeseen and rushed transfer of complex operations. Meanwhile, the government maintained the PSC was contractual and not enforceable via court, advocating for limited judicial oversight.

(With inputs from agencies.)