NEW DELHI -(Dow Jones)- Cairn India Ltd. (532792.BY), a unit of Cairn Energy PLC (CNE.LN), is in talks with India's private refiners to sell crude oil from its Mangala field in northwestern Rajasthan state, a person with direct knowledge of the matter said Friday.
"Commercial discussions with the refiners are in progress," the person, who asked not to be named, told Dow Jones Newswires.
Cairn, which began commercial production at the field Aug. 29, is currently producing 10,000 barrels of oil a day. It plans to ramp up output to 125,000 barrels a day in the first half of 2010.
The company said late Thursday that the federal government has agreed that private refiners qualify as additional offtakers of the Mangala crude.
The government had earlier approved Cairn's crude sales to state-run Mangalore Refinery & Petrochemicals Ltd. (500109.BY), Indian Oil Corp. (530965.BY) and Hindustan Petroleum Corp. (500104.BY).
India's three state-run refiners will be able to purchase a combined 700,000 tons of crude from the Mangala field in the fiscal year that began April 1 and 2.4 million tons in the following fiscal year, Junior Oil Minister Jitin Prasada said in August.
Cairn, which operates the Rajasthan block, holds a 70% participating interest, while Oil & Natural Gas Corp. (500312.BY) holds 30%.
-By Rakesh Sharma, Dow Jones Newswires; +91-11-4356-3334; rakesh.sharma@dowjones.com