Mumbai, Oct 15 - Rajasthan crude oil fields operator Cairn India Thursday said it had sold a 2.3 percent stake to Malaysian oil major Petronas and raised $1.6 billion through domestic and overseas channels to repay an existing debt and fund further investment needs.

The Cairn India scrip rose 3.45 percent to Rs. 289 on the news, before slipping to Rs. 284.20 around 11.20 a. m. It had closed Wednesday at Rs. 279.35.

Cairn will also sell a 10 percent stake to Petronas in its six existing operated blocks offshore Greenland. The Malaysian company will also have an option to raise this to 20 percent, the company said in a statement to the Bombay Stock Exchange.

The combined sale of assets and equity to Petronas will net Cairn about $310 million, comprising $240 million for shares of its Indian subsidiary and $70 million for the Greenland blocks.

Its parent entity will now hold about 62.75 percent in Cairn India.

Cairn estimates the peak output from its Rajasthan fields to touch about 175,000 barrels per day (bpd) - as much as 20 percent of India's domestic production.