London-listed Vedanta Resources is in talks to acquire a majority stake in Cairn India for up to 8.5 billion dollars and the deal may be announced in a couple of days, a report said.

Scottish explorer Cairn Energy Plc, which holds a 62.37 percent interest in its India-listed unit Cairn India, is seeking up to 20 percent premium for passing on a 51-percent controlling stake, the Press Trust of India (PTI) said, quoting two people it said had knowledge of the talks.

Billionaire Anil Agarwal, who heads Vedanta, "is meeting Cairn Energy Plc chief executive Bill Gammell in London today (Friday) and the deal is likely to be announced as early as Sunday evening or on Monday," PTI quoted one of its two sources as saying.

Cairn has three assets producing oil and gas, including the giant Rajasthan fields and seven exploration blocks.

PTI's sources said Cairn Energy has been in talks with India-focused Vedanta for three weeks on selling a majority stake.

Cairn Energy and Vedanta declined comment, the report said.

Upon acquisition of a majority stake, Vedanta Resources would have to make an open offer for an additional 20 per cent stake under Indian stock exchange rules.

Cairn India chief executive Rahul Dhir on Friday briefed India's Oil Secretary S. Sundareshan, who said the deal would need government approval.

"To me it looks like they (Cairn Energy) are not exiting completely," Dhir said. "The discussions are taking place between the majority shareholder and Vedanta. I am not part of those discussions," he added.

If it is successful, Vedanta -- which also has iron ore, zinc and copper mines -- would be the second-largest miner in the world after Australia's BHP Billiton to have an interest in oil.