The Petroleum Ministry hopes to decide by January-end on whether to allow Cairn Energy Plc to sell a majority stake in its Indian arm to Vedanta Resources.

“The final documentation with some conditions from Cairn Energy has been received by us in November-end. We require six to eight weeks to examine that. So, hopefully, we will have a decision by end of this month,” Mr S. Sundareshan, Petroleum Secretary, said.

Cairn needs Government approvals for the proposed deal to go through. Cairn has 10 oil and gas blocks in India, of which seven have been won under various NELP rounds. The three oil and gas producing assets – the prolific Rajasthan oil fields, Ravva oil/gas fields and Cambay gas/oil fields – are acreages acquired prior to the NELP regime.

The Government has been saying that Cairn needs the Petroleum Ministry's approvals for all acreages NELP as well as pre-NELP regime. Cairn Energy is selling up to 51 per cent stake in Cairn India to Vedanta Resources for up to $8.48 billion.

Iran conundrum

Mr Sundareshan also said that India hopes to resolve the oil payment problem with Iran amicably when Indian officials visit Tehran later this week. He told reporters that the talks were aimed at finding a quick resolution. Officials from the Finance and Oil Ministries and the Reserve Bank of India are visiting Tehran.

Iran and India have been trying to find an alternative payment mechanism after the RBI stopped Iran-related payments through the Asian Clearing Union route because of some technical reasons relating to clearing.

“Iran payment is very, very important for the Ministry of Petroleum and Natural Gas and oil companies…We are in discussions with NIOC (National Iranian Oil Co) to resolve the issue,” he said, adding, “We would require payments to be channelised through alternate banks which will be suggested by NIOC. We have on table some banks which have been suggested. We will probably work through them.”

Related Topics
comment COMMENT NOW