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    HomeNewsBusinessCompaniesRoyalty issues could derail Cairn-Vedanta deal

    Royalty issues could derail Cairn-Vedanta deal

    A USD 10 billion deal for Vedanta Resources to take control of Cairn India and step into the lucrative oil business could falter due to an Indian state-run partner's concerns over royalties, reports the Economic Times.

    February 11, 2011 / 21:24 IST

    A USD 10 billion deal for Vedanta Resources to take control of Cairn India and step into the lucrative oil business could falter due to an Indian state-run partner's concerns over royalties, reports the Economic Times.

    Oil Minister S. Jaipal Reddy said on Tuesday that state-run Oil and Natural Gas Corp's (ONGC) concerns over the royalties must be addressed for the deal, keenly awaited by shareholders and seen as a barometer of India's investment climate, to go through.

    ONGC owns 30% of a block in Rajasthan which pumps Mangala crude. Under an agreement drawn up with Cairn when it was fully state-owned and India needed to tempt investors into its budding exploration programme, it pays all the royalties.

    Source: The Economic Times

    first published: Feb 11, 2011 09:17 pm

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