Mumbai: Cairn India on Thursday said the results of a shareholder vote for acceptance of conditions imposed by the government on parent firm Cairn Energy's sale of a majority stake in the Indian subsidiary to Vedanta Resources will be declared on September 14.

Cairn Energy, which holds a 52.11 per cent stake in Cairn India, has already informed the government and its partner ONGC that it, along with Vedanta (which has an 18.5 per cent stake), will vote for accepting conditions that include Cairn India agreeing to pay royalty and cess on the mainstay Rajasthan oil block.

"Cairn India has written to all of you to seek your views on accepting the conditions put in place by the government for them to finally clear this transaction," Cairn India Non-Executive Director Jann Brown told shareholders here on Thursday.

Cairn Energy is selling a 40 per cent stake in Cairn India at Rs 355 a share to fetch USD 6.02 billion from London-listed mining group Vedanta. Vedanta has already acquired an 18.5 per cent stake in Cairn India from minority shareholders and Malaysia's Petronas.

She said the government has approved the transaction and "has imposed certain conditions".

Cairn India currently does not pay any royalty on its 70 per cent interest in the Rajasthan fields. Royalty, as per the contract, is paid by state-owned ONGC, which got a 30 per cent stake in the 6.5 billion barrel field for free.

The Cabinet Committee on Economic Affairs (CCEA) had on June 27 given consent to the Cairn-Vedanta deal, but subject to Cairn or its successor agreeing to charging or deducting the royalty paid by ONGC from revenues earned from the sale of oil before profits were split between partners. This cost-recovery of royalty will lower Cairn India's profitability.

The CCEA also said Cairn India must pay Rs 2,500 per tonne cess on its 70 per cent share of oil production. Cairn has challenged this liability through international arbitration, but will now have to withdraw its suit to get the nod for its parent's stake sale.

Unlike royalty, Cairn is already paying cess to the government under protest, but has made it cost-recoverable on the plea that the contract provides for all capital and operating expenditure, besides taxes and levies, to be deducted from revenues before profits are split.

This is the same logic that the government has used for royalty being cost-recoverable.

Brown said Cairn India believes the Rajasthan block can produce 240,000 barrels per day of oil, as against its present output of 125,000 bpd.  "Without the active support of the government of India and (partner) ONGC, it will not be possible for Cairn India to exploit the full potential of the resource base in Rajasthan," Brown said.

She said Cairn India is now responsible for the delivery of significant domestic crude production from its operated assets across the country.

"Output reached 125,000 barrels of oil per day, with the crude now being transported to a number of Indian refineries by the world's longest continuously heated and insulated pipeline," she said.

This pipeline infrastructure is not only a global engineering achievement, but also a strategically important asset, because all the remaining fields and discoveries in Rajasthan can be quickly connected to the market.