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Hardy Oil and Gas CEO Ian MacKenzie. Image courtesy of Hardy Oil and Gas.

A consortium led by Reliance Industries Limited relinquished its offshore India D3 block Tuesday after India’s Ministry of Defense imposed access restrictions at portions of the block.

India-based Reliance holds a 60 percent operating stake in the block, BP holds a 30 percent stake and Hardy Oil and Gas holds a 10 percent stake.

India’s Directorate General of Hydrocarbons is also a part of the management committee although it does not hold a working interest in the project.

Production at the block was initially projected to start production by the end of the year.

Earlier this year, India’s ministry of defense designated a portion of D3 block as a defense research and development organization impact zone.

The designation has restricted access to parts of the block and prevented the group from carrying out work at the site.

The D3 consortium declined to continue work in the unrestricted area of the block due to anticipated cost and risk increases.

UK-based Hardy Oil and Gas said problems tied to the restriction were further compounded by the uncertainty of long term natural gas pricing in India after a new government policy imposing “significant” discounts was announced earlier this year.

Neither Reliance nor BP have commented on the relinquishment.

Hardy is released from any further work program liability related to unfinished minimum work program penalties.

The company expects to take a $22 million writedown this year for investments at the D3 block.