Government asks Cairn for details of Vedanta deal
21 August 2010
The government has written to Scotland's Cairn Energy Plc to submit details of its deal to sell a majority stake in its Indian arm, Cairn India Ltd - the company that operates the giant Rajasthan oilfields - to London-listed Vedanta Resources, petroleum and natural gas minister Murli Deora said on Friday.
The petroleum ministry has written a two-paragraph letter to Cairn Energy seeking more information on the nature of the transaction.
Anil Agarwal's Vedanta group has proposed to pick up a 51-60 per cent stake in Cairn India for $8.5-9.6 billion through direct share purchase from promoter Cairn Energy and an open offer.
''We have told Cairn to write to us. Then we will decide,'' Deora said.
State-owned Oil and Natural Gas Commission feels it has the first right of refusal of Cairn India's stake because it holds a 30-per cent interest in the 6.5-billion barrel a year Rajasthan block, in which Cairn holds 70 per cent interest.
This means ONGC has the rights to 30 per cent of the crude from the Rajasthan fields, with Cairn holding the rights for the rest.