Cairn India Ltd and ONGC have approach the Petroleum Ministry to decide a best price for Rajasthan crude oil.

The production-sharing contract (PSC) signed with the Union Government requires price to be fixed and it should adjusted for differences in quality, delivery time, quantity and payment terms. As per the price proposed by an international consultant, KBC, the crude could be priced at $ 58.30 a barrel.

Potential buyers of Cairn include all the state-owned refiners such as Bharat Petroleum Corp, Indian Oil Corp, and Hindustan Petroleum Corp, as well as the private sector players such as Reliance Industries Ltd. Both ONGC and Cairn have appointed their consultants for the pipeline project.

Cairn India has engaged a  global consultant to undertake a technical feasibility study to transport crude oil from its field where as ONGC has asked Engineers India Ltd to do the same.

Cairn expects to begin producing from Rajasthan by 2009. The fields - Mangala, Aishwariya and Bhagyam - have a targeted production of 150,000 barrels of oil per day. ONGC is a 30 per cent partner in the field.

Also see

Cairn reaches agreement with ONGC on Rajasthan pipeline (25-Jan-2007)