Cairn's wait continues, NOC for Vedanta on hold again

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LesCrozes

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Inscription: Jeu 14 Mai 2009 16:23

Message Sam 19 Nov 2011 10:26

Cairn's wait continues, NOC for Vedanta on hold again

Cairn's wait continues, NOC for Vedanta on hold again
Published on Fri, Nov 18, 2011 at 20:37 | Source : CNBC-TV18
Updated at Sat, Nov 19, 2011 at 11:26

The saga of clearances for Cairn-Vedanta continues with oil ministry sources today saying that the home ministry was yet to provide security clearance to the deal, reports CNBC-TV18's Siddharth Zarabi.
Officials said no timeline could be suggested for the security nod, adding that Cairn executives Bill Gamell and Rahul Dhir are scheduled to meet Oil Minister Jaipal Reddy, later in the evening today.
The long awaited No Objection Certificate (NOC) from ONGC to Cairn for the Vendata deal has gone been backtrack yet again. And, it is now going to be a longer wait for that deal to materialize.
On September 27, the ONGC board had actually agreed to give that NOC provided they got a written pact from Cairn India for withdrawing the cess arbitration and also working out as far as a contentious royalty issue is concerned.
However, sources have said that Cairn India expects home ministry nod for Vedanta deal next week. According to Cairn sources, they don't have any major issues pending with ONGC too.
Cairn will have to reimburse ONGC for the royalty that ONGC has been paying on the behalf of Cairn at the Barmer oilfield and this is where the complication is lying.
Ce que l'on conçoit bien, s'énonce clairement, Et les mots pour le dire arrivent aisément. BOILEAU
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phili675

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Message Mer 23 Nov 2011 09:20

Doucement ..mais tout va arriver en même temps !!

22 NOV, 2011, 08.18PM IST, PTI
ONGC likely to give NOC for Cairn-Vedanta deal by December end




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NEW DELHI: State-owned Oil and Natural Gas Corp is likely to give its 'no-objection certificate' to Cairn Energy Plc's stake sale in its Indian unit to Vedanta Resources by the year-end, its Chairman Sudhir Vasudeva said today.

"Our Board had in principle given the NOC (no-objection certificate) in September," he told reporters here.

The NOC will be given after Cairn Energy, its Indian arm Cairn India and the mining group sign a legally binding agreement accepting to share royalty and pay cess on the most important Rajasthan oilfields.

The need for a legal document has arisen because Cairn India insisted on ONGC giving a no-objection to the Cairn- Vedanta deal before agreeing to twin conditions that the government had set for clearing the USD 9-billion deal.

"The agreement is in the final leg," Vasudeva said. "I am hopeful the NOC will be given before end of December."

Cairn Energy, which holds a 52.1 per cent stake in Cairn India, plans to sell a 30 per cent stake to Vedanta. The government had in June, approved the deal subject to consent from ONGC, which is a partner in its mainstay Rajasthan block.

ONGC, for whom the Rajasthan project had been a losing proposition because it paid royalty not just on its 30 per cent share but also on Cairn India's 70 per cent interest, has demanded an equitable sharing before the deal was cleared.

The mutual distrust has given rise to the need of a legal document where in Cairn will give in writing that it will pay Rs 2,500 per tonne cess on its share of production from the all-important Rajasthan oilfields and also makes royalty payments cost-recoverable. ONGC will agree to issue NOC.

Cairn India does not pay any royalty on its 70 per cent stake in the Rajasthan fields. Royalty, as per the contract, is paid by state-owned ONGC, which got a 30 per cent stake in the 6.5 billion-barrel-field for free.

However, even before the USD 9.6 billion Cairn-Vedanta deal was announced in August last year, ONGC had demanded that like all other taxes, royalty should be added to the project costs, considering it as revenue earned from oil sales before profits were split between partners.

Cairn had opposed this as it would lower its profitability and had also initiated arbitration against the government contesting its liability to pay oil cess on its share. It believed that cess, like royalty, was also the liability of ONGC.

But Cairn Energy and Vedanta agreed to the conditions to get the deal cleared.
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mgauthi4

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Inscription: Dim 6 Sep 2009 20:50

Message Mer 23 Nov 2011 18:32

Re: Cairn's wait continues, NOC for Vedanta on hold again

Cairn India still waits for NOC for Vedanta deal
Monday 21 Nov, 2011It is reported that the saga of clearances for Cairn and Vedanta continues with oil ministry sources saying that the home ministry is yet to provide security clearance to the deal.

Officials said no timeline could be suggested for the security nod, adding that Cairn executives Mr Bill Gamell and Mr Rahul Dhir are scheduled to meet Oil Minister Jaipal Reddy.

The long awaited No Objection Certificate from ONGC to Cairn for the Vendata deal has gone been backtrack yet again. And, it is now going to be a longer wait for that deal to materialize.

On September 27, the ONGC board had actually agreed to give that NOC provided they got a written pact from Cairn India for withdrawing the cess arbitration and also working out as far as a contentious royalty issue is concerned.

Cairn will have to reimburse ONGC for the royalty that ONGC has been paying on the behalf of Cairn at the Barmer oilfield and this is where the complication is lying.

(Sourced from MONEYCONTROL)

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