In a blow to Cairn India ltd, a plea of the UK-based Vedanta group company to export its share of crude oil from Barmer oil field in Rajasthan was on Tuesday rejected by Delhi High Court on the ground that domestic crude cannot be exported till India attained “self sufficiency”.
Justice Manmohan said that in the instant case, as no notice of India attaining self-sufficiency was given to Cairn, it can only claim compensation from the Government for not picking up its share of crude from the oil field.
Under the production sharing contract (PSC) between Cairn and the Centre, the company gets 70 per cent of the crude produced from Barmer, with the rest going to the Government.
The Government or its nominee can pick up the company’s share of crude and what is not picked up can be sold to private players or exported, Cairn had said during arguments.
The Government, represented by Additional Solicitor General Tushar Mehta and the Centre’s standing counsel Anurag Ahluwalia, had opposed Cairn’s plea saying that an empowered committee had decided that export of the domestic crude oil cannot be allowed as it would be detrimental to India’s energy security.
The court agreed with the decision of the Empowered Committee of Secretaries denying permission to Cairn to export its share of crude oil, saying the reasons given by the panel “are legal, germane and valid grounds”.
“In fact, the policy prohibiting export of crude oil has concurrence of all the departments of Union of India and has nexus with the energy security of the country,” the court noted in its judgement.
The empowered committee had denied Cairn’s request for exporting its share of the crude oil, saying till India attained self sufficiency, domestic crude cannot be exported as it would be detrimental to energy security of the country and also violate the provisions of the PSC.
“Consequently, attaining self sufficiency is a precursor to trigger the right of petitioner to seek permission to export the participatory interest or share of crude oil and condensate.