Vedanta Oil & Gas Limited disclosed an encumbrance over 56.38% of its total share capital following a $2,250,000,000 facility agreement executed by its promoter group entities. The disclosure, submitted to BSE Limited and National Stock Exchange of India Limited on July 22, 2026, details the agreement entered into on July 20, 2026, by Twin Star Holdings Ltd as the borrower and Vedanta Resources Limited, Vedanta Holdings Mauritius II Limited, and Welter Trading Limited as guarantors. GLAS Agency (Hong Kong) Limited acts as the agent and security agent for the facility, which restricts the creation of any security or quasi-security over the company's shares by the obligors or the Vedanta Resources Limited group.

Facility Agreement Structure

The facility involves arrangers including Barclays Bank PLC, Citigroup Global Markets Asia Limited, DB International (Asia) Limited, First Abu Dhabi Bank PJSC, J.P. Morgan Securities (Asia Pacific) Limited, Mashreq Bank PSC, Standard Chartered Bank, and Sumitomo Mitsui Banking Corporation Singapore Branch. As of the disclosure date, the commitment of the original lenders is $1,545,000,000, with an increase commitment of up to $705,000,000 available. The total maximum commitment under the facility is $2,250,000,000. Proceeds are designated for the repayment of financial indebtedness, payment of fees, and general corporate purposes, explicitly excluding thermal coal infrastructure or remittance to India.

Encumbrance and Shareholding

The encumbrance covers 2,204,724,753 equity shares, representing 56.38% of the total share capital. This follows an existing encumbrance over the same shares pursuant to guaranteed senior bonds issued by Vedanta Resources Finance II PLC and a facility availed by Twin Star Holdings Ltd, as disclosed earlier on July 15 and July 17, 2026. The table below details the shareholding of the promoter group entities subject to the encumbrance:

Restrictions and Conditions

The facility agreement imposes specific restrictions on Vedanta Oil & Gas. No Obligor shall create or permit to subsist any security or quasi-security over the shares of the company. Additionally, no member of the Vedanta Resources Limited group shall create or permit to subsist any security or quasi-security over the shares owned by them in an Obligor which owns shares in the company. If and when the company becomes a Material Subsidiary of Vedanta Resources Limited, the group is required to continue to control the company or continue to own, directly or indirectly, at least 50.1% of the issued equity share capital.

The Delhi High Court has dismissed a writ petition filed by Vedanta Oil & Gas Ltd regarding the government's refusal to extend the Production Sharing Contract (PSC) for the CB/OS-2 Block. The judgment, dated July 22, 2026, impacts the company's operational rights for the specified block. Vedanta Oil & Gas has since filed a Letters Patent Appeal (LPA) before the Division Bench of the Delhi High Court to challenge the order and protect its interests.

The litigation involved Vedanta Oil & Gas challenging the Union of India (Ministry of Petroleum and Natural Gas) and the Directorate General of Hydrocarbons (DGH) over the non-acceptance of its application for the PSC extension. The court's decision represents a setback for the company's efforts to retain the block through the contract extension mechanism.

Legal Proceedings and Next Steps

Following the dismissal of the writ petition, the company has initiated appellate proceedings. The Letters Patent Appeal marks the next legal step in the dispute. Vedanta Oil & Gas stated it is pursuing appropriate remedies to contest the judgment.

Financial Implications

Vedanta Oil & Gas is currently evaluating the financial and operational implications arising from the judgment. The company has not yet quantified the potential impact in its regulatory filing. The outcome of the appeal remains crucial for determining the future operational status of the CB/OS-2 Block.