Vedanta sure of Cairn deal going through

NEW DELHI: Amidst Oil Ministry taking Vedanta Resources' acquisition of Cairn India to the Cabinet for approval, the London-listed mining group today said the USD 9.6 billion will go through.

Vedanta Chairman Anil Agarwal today met Oil Secretary S Sundareshan to discuss the approval process.

"This was a courtesy call... The meeting was very constructive and we look forward to a positive outcome," he said after the 20 minute meeting.

The oil ministry has set 11 pre-conditions, including addressing the issue of royalty that Oil and Natural Gas Corp ( ONGC) pays on behalf of Cairn, in the giant Rajasthan oil fields.

"We are evaluating the pre-conditions," Agarwal said without elaborating. "The deal must go through," he added.

Oil Minister S Jaipal Reddy said his ministry was attempting to get a decision on the deal as quickly as possible.

"Our idea is to take to Cabinet as quickly as possible. We have already circulated Cabinet note," he said, without giving a time frame by when the issue will be considered.

Vedanta is buying 40-51 per cent stake from UK's Cairn Energy and is expecting to close the deal by April 15.

It has to make an open offer for buying an additional 20 per cent from minority shareholders of Cairn India, a process that would take a minimum of 30-35 days to complete.

Vedanta is hoping that once it gets a favourable decision from the Cabinet, it would go to its shareholders to extend the April 15 deadline.

State-owned ONGC not just pays royalty on its 30 per cent share but also on Cairn India's 70 per cent share in the Rajasthan fields. ONGC and the oil ministry want the royalty to be equitably shared.

Cairn and Vedanta are both opposed to footing the royalty bill.