Indian conglomerate Vedanta’s Barmer oil and gas block in western India would be made unviable by a 10 per cent rise in the government’s share in the project’s revenue, a company lawyer told the country’s top court on Friday.

The Supreme Court was hearing a dispute between Vedanta and the federal government related to an extension of the production-sharing contract for the Barmer asset in the state of Rajasthan. “The levy of additional 10 per cent makes the project unviable,” senior advocate Arvind Datar, appearing for Vedanta, told the court.

The government has said it is entitled to increase its revenue share from the block by 10 per cent, having recently extended the contract for the Barmer asset by 10 years.

The initial licence to explore and produce oil and gas from the Barmer block expired on May 14, 2020.

The government had agreed to the extension against a higher revenue share as well as a settlement of Rs 5,651 crore dispute over cost recovery for the same.

Vedanta did not agree to either of the demands and challenged them in court. Against this backdrop, the company was given monthly or bi-monthly extensions, and the latest one was due to expire on October 31.

The company produced 1,20,805 boepd in the second quarter ended September 30.

The block, with 38 discoveries, till date, has total in place hydrocarbons of 5.9 billion barrels of oil equivalent (bboe).

The block has cumulatively produced more than 700 million barrels of oil equivalent (mmboe) in the last decade.