NIKO RESOURCES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) These appeals arise from a common order passed by the learned Single Judge on 8/3/2001 dismissing the applications of the appellants filed under Section 9 of the Arbitration and Conciliation Act, 1996 (Act No. 26 of 1996), hereinafter referred to as the Act.

(2.) The Government of India invited bids for the development of petroleum resources in the "Hazira Fields" which culminated into a Production Sharing Contract being signed on 23/9/1994 between the President of India, Gujarat State Petroleum Corporation Limited, respondent No. 2 and the appellant. The appellant and respondent No. 2 were collectively defined under the said Production Sharing Contract (PSC in short) as the contractors. The said contract provided for arbitration for settlement of disputes under Article 31 of the contract. The said article required that initially all disputes/differences or claims arising out of or in connection with any of the terms and conditions of the contract or concerning the interpretation or performance thereof, shall be settled by the parties amicably. In the eventuality of the disputes remaining unresolved the same are liable to be referred to an Arbitral Tribunal of three Arbitrators. The said clause requires the party or parties instituting the arbitration to appoint one Arbitrator and the party or parties responding to appoint another Arbitrator. The two Arbitrators appointed are to appoint the third Arbitrator.

(3.) A Joint Operating Agreement (JOA in short) was also executed on 5/12/1994 between the appellant and respondent No. 2 for the purpose of defining the respective rights and obligations of the said two parties with respect to the operation to be conducted under PSC. The said agreement also contained an arbitration clause incorporated in Article 13.