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than doubling the capacity of the domestic The minister added that the country continued to
strategic petroleum reserve (SPR), which strive towards a reduction in the country’s oil import
is located at three underground facilities in dependency, which is currently around 85%.
Padur, Mangalore and Visakhapatnam. The “Our five-pronged strategy to reduce crude
Padur facility has 2.5mn tonnes (18.33mn bar- oil import dependency including increasing
rels) of capacity, while Mangalore has 1.5mn domestic oil and gas production, promoting
tonnes (11mn barrels) and Visakhapatnam biofuels and renewables, energy conservation
has 1.33mn tonnes (9.75mn barrels). The and energy efficiency, improvement in refinery
government now wants to add another 6.5mn processes and demand substitution, is making
tonnes (47.65mn barrels) of capacity at Chan- an impact,” he said, before adding: “We still have
dikol and Padur. more room to cover.”
Cairn Energy keeps
arbitration award in its sights
PROJECTS & UK developer Cairn Energy reiterated
COMPANIES claims this week that it expects an arbitra-
tion panel to award it $1.4bn in damages
against the Indian government in their
long-running tax dispute.
The developer launched arbitration in 2015
after New Delhi froze the company’s local assets
in 2014 in a bid to enforce a multi-billion-dollar
back-dated tax claim. The government then liq-
uidated the bulk of the company’s holdings in the
middle of 2018 even as the arbitration process
was ongoing.
“Cairn is seeking full restitution for losses
resulting from the expropriation of its invest-
ments in India in 2014; continued attempts to
enforce retrospective tax measures; and the
failure to treat the company and its investments
fairly and equitably,” a Cairn Energy spokesper-
son told local financial daily the Mint on Sep-
tember 29.
However, Cairn Energy gave no reason as to
why an anticipated “end of summer” deadline for
the arbitration’s award was missed.
The company had said in July that while
the coronavirus (COVID-19) pandemic had
created “difficulties”, the tribunal hoped to
remain “reasonably within the lead time
it had anticipated”. Cairn Energy added: stake in Vedanta between May and October
“Whilst it [the tribunal] is not yet able to 2018. Cairn Energy received the stake in Vedanta
commit to a specific date for its ruling, it after the latter’s April 2017 merger with Cairn
expects a ‘release of the award after the end India, in which the UK company owned 10%.
of the summer’.” The government’s backdated tax demand
The final hearing of the arbitration took place related to Cairn UK Holdings’ transfer of shares
in December 2018 in Paris, with an award ini- in Cairn India Holdings to Cairn India in fiscal
tially having been anticipated by February 2019, 2006-2007 as part of an internal group restruc-
before being delayed to the end of 2019 and then turing. The transfer resulted in major capital
again to the summer of 2020. gains – as much as INR245.05bn ($3.35bn),
Cairn Energy is seeking restitution after the according to India’s income tax department –
government sold off 99% of the company’s 4.9% ahead of Cairn India’s IPO.
Week 39 01•October•2020 www. NEWSBASE .com P7
