In what comes as a relief for Cairn India Ltd., government owned Oil and Natural Gas Corporation Ltd. informed the Delhi High Court that they have approved the production sharing contract with Cairn India for the Barmer oil fields in Rajasthan.
ONGC has agreed for a 10 year extension of the contract with Cairn India, once the original contract expires in 2020.
ONGC has sent the extension approval to the Ministry of Oil, Petroleum and Natural Gas, Shashi Prabhu, the counsel for ONGC, told the court. “The government is now supposed to take the final decision,” Prabhu added.
In April this year, the Delhi High Court directed the government, ONGC and Cairn India to decide on the issue at the earliest.
The High Court has given the government five weeks to take a final decision.
Cairn India's counsel senior advocate CA Sundaram had urged the High Court earlier for a quick decision on account of the company's proposal to invest over Rs 30,000 crore after the original contract expires in 2020.
Cairn India's Rajasthan block comprises Mangala, Bhagyam, Aishwariya, and Raageshwari oil fields.
The High Court will hear the case on September 9, after the Centre submits its final decision.
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