RIL marked all correspondence with Oil Min, DGH

Reliance Industries had marked all copies of its correspondence with the Supreme Court-appointed Tribunal on KG-D6 cost recovery issue to the Oil Ministry and its technical arm DGH.
Contrary to the impression being created, RIL had subsequent to Supreme Court on April 29 appointing former Australian judge Michael Hudsom McHugh as third arbitrator to decide if the government was right in denying cost recovery of up to USD 2.3 billion for gas output from KG-D6 lagging targets, marked all correspondence with the Tribunal to the ministry and the DGH, sources said.
McHugh had on May 20 declined to be part of the Tribunal saying his consent was not taken, but subsequently agreed after lawyers for RIL and its partners BP plc of UK and Canada's Niko Resources contacted him on May 29.

Sources said RIL's advocates in an email on May 29 requested McHugh to accept his appointment as the third/ presiding arbitrator of the Tribunal. A copy of RIL's lawyer Tom Sprange's email was marked to the Director General of Hydrocarbons (DGH) and the Oil Ministry.
Government lawyers Swarup & Associates, who have now told the ministry that appointment of a foreigner as the presiding arbiter would be "undesirable" in the absence of any such contractual provision and difficulty in ascertaining the person's "independence and impartiality", was not marked on the email as it was not known at that time who would act for the government of India, they said.

Thereafter emails and correspondence were exchanged between the RIL and the Tribunal with respect to the fixing of fee for the arbitrators. By this time, government lawyers were intimated and they were marked on those emails but they chose not to reply, sources said.

On June 18, RIL's lawyers sent a letter to government's advocate stating copies of all the correspondence between the arbitrators and the parties will be provided to them.
McHugh on June 26 send an emial to all the parties on behalf of all arbitrators enclosing a working draft procedural timetable but a week later on July 2 government advocates sent emails asking the Tribunal not to proceed with the matter till a detailed response is issued by them and asked the Tribunal to send copies of all the documents correspondence exchanged.

Sources said the government felt McHugh appointment stood terminated the moment he declined to accept the appointment and thereafter he cannot reappoint himself.
McHugh withdrew from the Tribunal and RIL has field a fresh plea before the Supreme Court for appointment of a third arbitrator to decide on the case.