Will you buy sweet crude from Cairn or can it be exported: HC asks govt

The court has listed the matter for further hearing on January 19

Delhi High Court today sought the government's response on whether it would buy the excess "sweet" crude, containing low levels of sulphur, produced by Cairn India's Rajasthan oil field and if not, can the company export it.

Justice Rajiv Sahai Endlaw made this query to the Ministry of Petroleum and Natural Gas and the Directorate General of Foreign Trade (DGFT) on Cairn India's plea that it was being forced to sell the sweet crude to domestic private players at a much lower price than global rates.

"Counsel for respondent 2 and 3 (DGFT and ministry) to take instructions on whether government was willing to buy said crude and if not, whether permission can be granted for its export," the court said.

"If you have not appointed a nominee to buy it (crude), then either you buy or give them permission to export," the court said.

Central government standing counsel Anurag Ahluwalia, who appeared for the ministry and DGFT, said he will take instructions in four weeks on the issue and will inform the court.

Senior advocate C A Sundaram, appearing for Cairn, said whatever amount of the crude the government wants to buy the company will sell to it.

The court, then, listed the matter for further hearing on January 19.

Cairn, a subsidiary of UK-based Vedanta group, said it had made several representations to DGFT for permission to export the crude, but has not received any response.

It also claimed that prior to approaching DGFT, it had written to Indian Oil Corporation Ltd (IOCL) to "canalise" export of the crude, but got no response from the PSU.

IOCL is the canalising agent for export of crude.

Canalising agents are those through which a product can be imported or exported by companies which do not have permission to do so directly.