Oil and Natural Gas Corporation (ONGC) is assuming control of the CB-OS/2 Cambay basin block following the government’s refusal to extend the production sharing contract (PSC) filed by Vedanta, the block’s operator.

On September 19, the Union Ministry of Petroleum and Natural Gas informed the contractor parties—Vedanta, ONGC and Tata Petrodyne—that Vedanta’s PSC extension application had not been approved. In a separate communication, ONGC was directed to take charge of all data, assets, operations and responsibilities linked to the block as the government nominee. The company confirmed the takeover in a filing to stock exchanges on Monday.

ONGC clarified that this direction is a “purely interim measure by the Government of India to ensure continuity of petroleum operations in public interest and safeguard petroleum reserves until the block is awarded to another party.”

The offshore CB-OS/2 block on India’s west coast, comprising the Lakshmi and Gauri fields, currently produces 3,400 barrels of oil per day and 340,000 SCMD of gas. Originally awarded to Cairn Energy India under the pre-New Exploration Licensing Policy (NELP) PSC in 1998, the block received a Petroleum Mining Lease (PML) in 2002 after commercial discoveries. Vedanta acquired a majority stake in Cairn Energy in 2011, which was later merged with the group.

Vedanta, through Cairn Energy, held a 40 per cent stake in the block, ONGC 50 per cent, and the remaining 10 per cent with Tata Petrodyne, now acquired by Invenire Energy.