India has won an international arbitration against British firm Cairn Energy on cost deducted by the operators of Ravva oil and gas field, off the Andhra coast, before payment of government's share of profit petroleum.
Cairn India on Friday said its UK-based parent Cairn Energy Plc is unlikely to exit completely from the company.
Scottish explorer Cairn Energy has struck an estimated 20 million tonnes of oil and gas reserves in Rajasthan.
Britain's Cairn Energy Plc has struck oil and gas in Rajasthan, the fourth discovery by the British firm, in the block which borders Gujarat.
The UK-based Cairn Energy on Tuesday said it will seek government's "endorsement" and necessary consent for selling its majority stake in Cairn India to London-listed Vedanta Resources for $8.48 billion.
Cairn Energy Plc, which has 50 production blocks across the world, holds 10% in Cairn India.
The Income Tax department, which is probing Cairn Energy plc's transfer of India assets, has asked the UK-based company not to dispose of its 10.3 per cent holding in Cairn India.
Cairn Energy India's initial public offering of 32.88 crore (328.8 million) shares will open on December 11 and close on December 15 at a price band of Rs 160-190 per share.
Cairn Energy of UK is seeking compensation from the Government of India.
A senior company executive said the company waited for seven years for the verdict and its shareholders needed to know when it would be concluded.
Cairn faces a potential tax demand on an alleged Rs 24,500 crore of capital gains it made when in 2006-07 it transfered all its India assets to a new company, Cairn India.
Cairn said it had initiated arbitration.
The Finance Ministry on Monday said Cairn Energy Plc is likely to pay close to $1 billion as capital gains tax on the $8.48 billion it expects to get from selling majority stake in its India arm to Vedanta Resources.
Edinburgh-based Cairn said its Alpha-1S1 well in the sea between Greenland and Canada found oil over a 400 meter section and encountered gas reserves, the company said.
While UK's Vodafone Group fights its tax liability in courts, British firm Cairn Energy Plc on Wednesday said it will pay all taxes due, both in India and the United Kingdom, on the $8.48 billion sale of a majority stake in its Indian arm to Vedanta Resources.
The company has not been able to sell its 9.8% stake in Cairn India
The company sent the reminder on September 10, ONGC said in a filing to the Bombay Stock Exchange. Vedanta is offering $8.48 billion to buy up to a 51 per cent stake in Cairn India, which has 10 oil assets in the country, including the giant Rajasthan oilfield.
Cairn Energy has threatened the Indian government that it is looking at executing the favourable $1.2 billion international tribunal award in the retrospective taxation case by seizing India's overseas assets.
UK's Cairn Energy Plc has won an arbitration against the Indian government levying Rs 10,247 crore in retrospective taxes, the company said on Wednesday. The three-member tribunal, which also comprised a judge appointed by the Indian government, ruled that India's claim of Rs 10,247 crore in past taxes over a 2006-07 internal reorganisation of Cairn's India business was not a valid demand, sources said. The tribunal asked India to pay the funds withheld along with the interest to the Scottish oil explorer for seizing dividend, tax refund, and sale of shares to partly recover the dues.
Cairn Energy of UK will invest between $630 million and $859 million to develop its natural gas discovery in the deepwaters of Krishna Godavari basin, off the Andhra coast.
It is the second firm to have received retrospective tax notice this year after Vodafone Group.
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The Union government's offer of settling the retrospective taxation case with Cairn Energy may hinge on Vedanta withdrawing the ongoing arbitration from the Singapore Tribunal on the same issue. The government has offered to refund Cairn Energy Rs 7,900 crore that it had collected under the retrospective tax demand on fulfilment of certain conditions, including withdrawal of pending litigation and furnishing of an undertaking to the effect that no claim for cost, damages, interest, etc., would be filed. This condition is also part of the Taxation Laws (Amendment) Bill, 2021, passed by Parliament recently.
The government on Tuesday confirmed that a French court has ordered the freezing of certain Indian assets in Paris on a petition by Britain's Cairn Energy, which is seeking to recover $1.72 billion from New Delhi after winning an arbitration against retro tax. Minister of State for Finance Pankaj Chaudhary in a written reply to a question in the Rajya Sabha said the government has filed an appeal against an international arbitration tribunal overturning levy of Rs 10,247 crore in back taxes on Cairn Energy. "Yes sir, an order has been passed by a French Court freezing certain Indian government properties in the case pertaining to Cairn Energy," he said.
During a series of hectic talks between Cairn Energy and the Indian government over the $1.2-billion arbitration award in favour of the former last week, a slew of options was proposed by the two sides, including computation of capital gains and participation in the Vivad se Vishwas (VsV) dispute resolution scheme. The government is likely to go ahead and appeal against the arbitration award by a Permanent Court of Arbitration at The Hague before March 21, indicated finance ministry officials. Cairn Energy Plc on Sunday said it was hopeful that an acceptable solution to its tax dispute with the Indian government could be found to avoid prolonging and exacerbating the 'negative issue' for all parties.
Cairn Energy, which owns a 52.11 per cent stake in Cairn India, "has voted to accept (government) conditions", the company said.
A day after the government referred its $9.6 billion deal to a panel of ministers; UK's Cairn Energy Plc on Thursday said it has extended the deadline for completion of the sale of a majority stake in its Indian unit to Vedanta Resources by over a month to May 20.
Cairn India, the oil company 69 per cent owned by FTSE 100 listed Cairn Energy, is raising $625m from a private placement of shares to two investors, one of them Petronas, Malaysia's national oil company. The money will be used to invest in Cairn India, including the development of its large Rajasthan oil fields, for which cost estimates have been rising.
Mining conglomerate Vedanta Resources has completed the purchase of a 10 per cent stake in Cairn India from Cairn Energy, taking its total stake in the company to 28.5 per cent.
Interest from Malaysia's Petronas in Cairn India and Swiss Petroplus in Cairn India's parent, Cairn Energy, saw the shares of both the companies gaining on the bourses.
British energy firm Cairn Energy on Wednesday said its oil and gas operations in offshore Andhra Pradesh have not been affected by the Tsunami tidal waves caused by a massive earthquake.
Cairn Energy is back to its original image of an explorer, with its prime producing properties in India now going into the Vedanta group kitty.
More than three months after announcing the sale of its up to 51 per cent stake in the Indian unit to Vedanta, Cairn Energy Plc on November 23 last year had made a conditional application to seek government's nod but refused to accept partner ONGC's rights.
A day after agreeing to sell majority stake in its India subsidiary for $8.48 billion, UK's Cairn Energy Plc top management on Tuesday met Oil Minister Murli Deora and other key officials to clear any regulatory roadblocks to the deal with Vedanta Resources.
British energy firm Cairn Energy Plc on Thursday said it will pay all taxes due, both in India and the United Kingdom, on the $8.48 billion it will gain from selling a majority stake in its Indian arm to Vedanta Resources.
UK's Cairn Energy has informed Oil Ministry that it will comply with all contractual obligations in selling majority stake in its Indian arm and that London-listed Vedanta Resources was a fit candidate to take over operations.
Cairn Energy Plc's deal to sell a majority stake in its Indian arm to Vedanta Resources for up to $8.48 billion is contingent upon the billionaire Anil Agarwal-led group completing an open offer to minority shareholders of Cairn India, a senior official said.
British energy firm Cairn Energy Plc plans extensive exploration over the next 18 months its Rajasthan block, the site of India's largest oil discovery in almost two decades.
State-owned Oil and Natural Gas Corp on Monday said UK's Cairn Energy Plc cannot sell a majority stake in Cairn India to Vedanta Resources without its consent.
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