NEW DELHI: Vedanta Ltd’s oil and gas arm Cairn has got a further three-month extension of license for its prolific Rajasthan oil block pending settlement of a dispute over $520 million cost recovery.
The license to explore and produce oil and gas from Barmer was due to renewal in May this year, but pending settlement of the dispute the government has given five extensions, the latest till January 31, 2021.
In notes to its second quarter earnings statement, Vedanta said it believes “the company is eligible for automatic extension of production sharing contract (PSC) for Rajasthan (RJ) block on same terms with effect from May 15, 2020.”
The government had in October 2018 agreed to extend by 10 years the contract for Barmer fields in Rajasthan after the expiry of the initial 25-year contract period on May 14, 2020.
This extension was subject to the Vedanta Group firm agreeing to raise the share of the government’s profit from oil and gas produced from the block by 10 per cent.
