Cairn expecting payment of $1.06 billion from India within weeks: Report

"We anticipate the return of capital to shareholders this year," Chief Executive Officer Simon Thomson said on a conference call, according to a Bloomberg report. "The Indian government is very focused on resolving this as quickly as possible and they are targeting completion within the next few weeks."

The company said it expects to receive around $1.06 billion "near term" as it expects to resolve the dispute with the long-running dispute with the Indian government soon

The company's shares rose as much as 8.2% in London, the biggest intraday gain in a month, and traded up 0.6% at 196.2 pence as of 8:38 a.m. local time, Bloomberg reported.

The Indian government opened a way for a resolution after doing away with a rule on retroactive taxes that had led to billions of dollars of court battles with international companies including Cairn and Vodafone Group Plc.

Some six years ago, Cairn received its tax claim from the Indian government over a restructuring it carried out in 2006 while preparing for an initial public offering (IPO) of Cairn India.

However, an international arbitration tribunal in an order asked India to give back $1.2 billion plus interest, but the funds weren't forthcoming, said the report.

The settlement will also bring an end to a multiyear battle, during which Cairn filed cases in several locations across the world to enforce the arbitration ruling in its favor.

In order to get the refund, Cairn said Tuesday it will be required to take back its arbitration award claim, interest and costs, and end all legal enforcement actions, the report said.

After returning cash to investors, Cairn plans to spend the remaining proceeds on its assets, it further said.

Following the settlement from the Indian government, shareholder resolutions on the company's proposed $500 million dividend and a buyback of as much as $200 million may take four to six weeks, Thomson said, reported Bloomberg.