ECS likely to mull Cairn India's proposal to lay pipeline
ECS will consider shifting crude oil delivery point from the Rajasthan field flange to Salaya in Gujarat with the cost of laying the 585-km pipeline from Barmer to the new sale point.
By PTI |
NEW DELHI: An Empowered Committee of Secretaries (ECS) is likely to consider on February 22 Cairn India's proposal to lay a 800 million dollar pipeline for transporting crude oil from its vast Rajasthan oil fields and recovering the cost through sale of crude oil.
The ECS will consider shifting crude oil delivery point from the Rajasthan field flange to Salaya in Gujarat with the cost of laying the 585-km pipeline from Barmer to the new sale point including the field development cost that would be recovered by Cairn from sale of oil.
Official sources said the pipeline was necessitated after Mangalore Refinery - the official buyer of Rajasthan crude - said it can take only 1-1.2 million tons out of the 7.5 million tons output planned from the Rajasthan field.
MRPL would be denominated as the Government nominee for buying from crude the Rajasthan fields and Cairn would be given freedom to market the oil in India.
If ECS, comprising secretaries from finance, law and petroleum, agreed to the proposal, it may need to go to the Cabinet Committee on Economic Affairs for final consent.
Law Ministry, which was referred the issue, has already concurred to the proposal and finance ministry too is believed to have given no objection, sources said.
Oil Ministry had in 2006 mooted the idea of Cairn and its 30 per cent partner ONGC laying the pipeline and claiming cost recovery by including it in field development cost. But it subsequently dragged its feet, giving Cairn approval to go ahead with acquiring right of user for the pipeline only in August 2007 but delayed the cost recovery approval.
It in December referred the issue to Law Ministry and later sought ECS nod.
The ECS will consider shifting crude oil delivery point from the Rajasthan field flange to Salaya in Gujarat with the cost of laying the 585-km pipeline from Barmer to the new sale point including the field development cost that would be recovered by Cairn from sale of oil.
Official sources said the pipeline was necessitated after Mangalore Refinery - the official buyer of Rajasthan crude - said it can take only 1-1.2 million tons out of the 7.5 million tons output planned from the Rajasthan field.
MRPL would be denominated as the Government nominee for buying from crude the Rajasthan fields and Cairn would be given freedom to market the oil in India.
If ECS, comprising secretaries from finance, law and petroleum, agreed to the proposal, it may need to go to the Cabinet Committee on Economic Affairs for final consent.
Law Ministry, which was referred the issue, has already concurred to the proposal and finance ministry too is believed to have given no objection, sources said.
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Oil Ministry had in 2006 mooted the idea of Cairn and its 30 per cent partner ONGC laying the pipeline and claiming cost recovery by including it in field development cost. But it subsequently dragged its feet, giving Cairn approval to go ahead with acquiring right of user for the pipeline only in August 2007 but delayed the cost recovery approval.
It in December referred the issue to Law Ministry and later sought ECS nod.
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