State-owned Oil and Natural Gas Corporation (ONGC) is learnt to have sought legal opinion from the Solicitor General of India on its right and legal position in the $9.6 billion Cairn-Vedanta deal which has run into trouble with the authorities here.
Officials in the Petroleum and Natural Gas Ministry said ONGC had sought opinion from the Solicitor General after its partner Cairn Energy plc stated that the U.K. firm's sale of majority stake in Cairn India to Vedanta Resources will not trigger pre-emption rights of the state-owned firm.
ONGC has, in the past, expressed its opinion that it has pre-emption or right of first refusal in all the three producing oil and gas fields operated by Cairn India and Edinburgh-based Cairn Energy needs its consent for sale of stake to Vedanta. ONGC has 30 per cent interest in the giant Rajasthan oil block, 40 per cent in the Ravva oil and gas fields off the Andhra Pradesh coast and 50 per cent in Gauri and Lakshmi gas fields in Cambay basin off the West Coast. Cairn Energy has stated that it is selling up to 51 per cent out of its 62.38 per cent holding in Cairn India to London-listed Vedanta at the corporate level and the deal does not trigger pre-emption rights of ONGC as the transaction was at shareholder level and not a sale of interest in a particular oilfield.
ADVERTISEMENT
However, ONGC is not in agreement with the position taken by Cairn Energy and has so sought opinion of SGI, the official said. The provisions of the Production Sharing Contract (PSCs) for the exploration blocks and the Joint Operating Agreement (JOA) in respect of the production ones have been submitted to the SGI.