PetroMin won't stop Cairn deal: official

But ONGC-led counter-offer not being ruled out.

The government will not create obstacles for the multi-billion Cairn Energy-Vedanta deal. A senior official in the ministry of petroleum and natural gas said the government was awaiting a response to its letter to Cairn Energy, that has agreed to sell a minimum 40 per cent in Cairn India to Anil Agarwal’s London-based Vedanta group.

Ever since Vedanta agreed to buy 51-60 per cent stake in Cairn India for $8.5-9.6 billion, the ministry gas has been maintaining that the deal would require clearances from it, though the requirement is still not clear. “The deal will go through. We are not doing anything to stop the deal. We have just sought some clarifications from Cairn Energy on the deal. They are yet to get back to us,” a senior official told Business Standard.

Government-controlled Oil and Natural Gas Corporation (ONGC), partner in Cairn India’s three producing assets, had its board meeting today. “I apprised the members of the status ever since the Cairn-Vedanta deal was made public,” chairman and managing director R S Sharma told reporters after the meeting.

The company is still examining the implications of the deal on the production sharing contracts with the government for oil and gas blocks. “We are examining legal and contractual implications of the Cairn-Vedanta deal on us,” Sharma said, but refused to comment on whether the company would make a counter-offer.

ONGC is a 30 per cent partner of Cairn India in the prolific Rajasthan oilfields, at the centre of the takeover deal.