Cairn-Vedanta deal goes to cabinet for direction
With neither Cairn and Vedanta nor state-owned ONGC showing any signs of relent in their tussle over Rajasthan block, the petroleum ministry is taking the issue to the Cabinet for a direction.
The Cabinet note, which was readied today after a meeting with petroleum minister Jaipal Reddy at his residence, outlines the letters exchanged between the ministry and Cairn, the outcome of the talks between the ministry, Cairn and Vedanta on Sunday, and highlights that an unconditional approval by the government would entail an outgo of Rs 21,800 crores by the ONGC.
The $9.6-billion share sale by Cairn to Vedanta has been mired in legal interpretations with the ministry willing to give an in-principle approval provided Vedanta accepted 11 pre-conditions, including sharing the cost of royalty and cess payments in Rajasthan block RJ-ON-90/1 currently paid by ONGC. ONGC has a 30 per cent stake in the oil field and is its licensee.