Vedanta Resources chief Anil Agarwal on Friday called on oil secretary S Sunderashan in the national capital amidst company's apprehesions over getting government nod on the multi-billion dollar Cairn-Vedanta deal.

Agarwal proposed in August last year to buy 40-51 per cent stake in Cairn India for $8.5-9 billion. But, Cairn Energy and Vedanta on one side and ONGC and oil ministry on the other have not budged from their positions even after several rounds of discussions in the past few months. This has forced oil minister S Jaipal Reddy to recommend to the cabinet committee of economic affairs (CCEA) that Cairn should be made to pay royalty for crude produced from the Barmer block.

“We had a constructive meeting and we are looking for positive outcome. Deal must go through and for that whatever is requirement of the government, we are furnishing and looking forward for positive outcome,” Agarwal told reporters after his 20 minute meeting with the top bureaucrat in oil ministry.

At the same time, oil minister Reddy said on Friday that he wants the CCEA to take a decision as soon as possible.

As reported in Financial Chronicle on Friday, the oil ministry in its proposal to CCEA has set strict conditions for the companies before they could clinch the deal. Also, the pre-conditions such as royalty sharing, cess payment if factored into the deal, will bring down the valuation of the assets drastically.

At present, the deal is valued at $8.5 billion to $9 billion for the 40-51 per cent stake in Cairn India that Anil Aggarwal’s London-based Vedanta Resources wants to buy from Cairn Energy.

Sharing of royalty has been a bone of contention between the ministry and Cairn Energy. If CCEA clears the proposal, Cairn will have to fork out Rs 12,600 crore as royalty over the lifetime of Barmer oil field. After apportionment, the state-owned ONGC will have to pay Rs 5,400 crore over 15 years as royalty. The total royalty at the current rates will thus work out to Rs 18,000 crore, payable by Cairn and ONGC, which have ownership of the asset.

Cairn India operates the block and holds 70 per cent stake, whereas ONGC has 30 per cent participating interest in the field.

The ministry told the cabinet committee that Cairn would have to obtain a no-objection certificate from ONGC before going ahead with the deal. The ministry has also asked Cairn to pay a cess on mined oil.