Public Policy: The Double Edged Sword In Enforcement Proceedings

The District Court of Columbia in recent proceedings between Hardy Exploration & Production (India) Inc. ("HEPI") v. Government of India (Ministry of Petroleum and Natural Gas),¹ have witnessed fervent debates on enforcement of arbitral award and its far-reaching impact across jurisdictions.

Factual Background

Contractual relationship between the parties, HEPI and Union of India ("UOI") was governed through a production sharing contract ("PSC") entered in November, 1996 for the extraction, development and production of hydrocarbons in a geographic block in India ("Block").

Disputes arose between the parties, which were subsequently referred to arbitration pursuant to the clauses in PSC. The arbitration clause in the PSC recorded the venue of arbitration as Kuala Lumpur, unless otherwise agreed.² The arbitral tribunal rendered its final award in favour of HEPI, signed and delivered in Kuala Lumpur in February 2013 ("Award"), upholding that: