Essar Oil has lost a Rs3,020 ($615 million) claim for damages suffered by its Vadinar refinery during the 1998 cyclone, after a tribunal ruled against the company in a case against United India Assurance Co.
Essar Oil, which owns a 300,000 barrels per stream-day refinery at Vadinar in Gujarat, had drawn the insurance policy in 1996 and the cyclone hit the refinery in 1998.
Mumbai-based Essar said it had drawn an insurance policy with state-run United India Insurance Co in 1996, according to a company statement.
Essar Oil filed the claim when its Vadiner Refinery in Gujarat was hit by the cyclone in the west coast in 1998 and the refinery suffered damages, causing delays in the commencement of operations.
However, the company said the verdict has no impact on its business since the claim amount hasn't been accounted for in its books and that it will explore all legal options to contest the ruling.
"We are currently examining the contents of the award, which is voluminous in nature. But prima facie it appears that the Arbitral Tribunal has not dealt with certain issues that were put forth during the hearing," it said.