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Panel refers Cairn deal back to Cabinet

business Updated: May 28, 2011 01:19 IST
HT Correspondent
HT Correspondent
Hindustan Times
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A group of ministers (GoM) on Friday decided to refer the $9.6-billion Cairn-Vedanta deal to the Cabinet Committee on Economic Affairs (CCEA) for a final decision on whether or not to approve the deal, currently stuck over the issue of royalty.

"We have taken a decision but I cannot divulge the details," said Jaipal Reddy, petroleum minister. The GoM's recommendation will be referred to the CCEA for a final decision, he said, adding, it will take a decision within two weeks.

Reddy, however, refused to comment if the GoM has approved the oil ministry's view on making the royalty on crude oil produced from the Rajasthan fields as cost recoverable.

"Traditionally it has been the procedure that proceeding of the GoM is not made public. The GoM has taken its own views. This view will be presented to the Cabinet. The GoM is not going to meet again," he said.

Cairn Energy agreed last August to sell a majority stake in Cairn India to Anil Agarwal-led Vedanta Resources. However, the deal, one of the largest in India's oil and gas sector, has been delayed by nearly 10 months due to a royalty payment dispute between Cairn India and ONGC.

Earlier this month, Cairn Energy Plc extended the deadline for finalising the sale for a second time, but did not provide a new date.