The three arbitrators for the long-standing dispute between the Canadian energy company Niko Resources, the Gujarat State Petroleum Corporation and the central government over the cost recovery of the pipeline from the Hazira field will be selected by Justice V N Khare of the Supreme Court.
The parties had tried for a compromise, but they reported to the judge on Friday that there was no settlement and arbitrators should be appointed by him, following the procedure laid down in the Arbitra-tion and Conciliation Act.
According to Section 11, when there is such a deadlock in international arbitration, the Chief Justice of India or a person designated by him shall decide the question of appointment. Niko Resources and the Indian company built the pipeline but they fell out, leading to one round of litigation in the Delhi High Court.
Now the central government has also become a party to the case which has disputed the items in the cost-recovery formula.
According to the law, the party instituting the arbitration will nominate one arbitrator, the respondent will nominate the officer, and the two arbitrators will choose the third.
While Niko has nominated former Chief Justice P N Bhagwati, the Indian company is said to have selected former Justice D P Wadhwa of the Supreme Court.
The central government wanted Justice Khare to select all the three members of the panel. All the three parties wanted the arbitration to go on but could not agree on the arbitrators.
Therefore, they moved designated judge, Justice Khare, who reserved his order on the choice of the arbitrators.
