Cairn India Ltd (Consolidated

RNS Number : 8854S

Cairn Energy PLC

27 May 2009

 



For Immediate Release                                                                                                    27 May 2009

Cairn Energy PLC

Cairn India Limited (Consolidated) Financial Results

The attached release was issued today by Cairn India Limited ('Cairn India') to the Bombay Stock Exchange and the National Stock Exchange of India.

In accordance with its Indian reporting obligations, Cairn India has today issued its financial results for the fifteen month period ended 31 March 2009. This financial information is reported in Indian rupees and is prepared under Indian GAAP.

Cairn Energy PLC has a 65% holding in Cairn India.

Key differences between the financials prepared under Indian GAAP to those under IFRS are summarised in the table below:

	IGAAP	IFRS
Accounting policy
Exploration write off (income statement)	Unsuccessful and other exploration costs (eg seismic) are expensed as incurred	Unsuccessful costs are written off; other exploration costs are capitalised pending determination
Depletion & Decommissioning	Based on working interest production and reserves	Based on entitlement interest production and reserves
Foreign exchange (income statement recognition)	Exchange gains and losses recognised on translation of US$ transactions/balances into INR reporting currency	No exchange gains or losses recognised on US$ transactions/balances where US$ is also the functional currency
Share Based Payments	Charge based on intrinsic value	Charge based on fair value
Disclosure
Operator fees	Included in income from operations	Included within other operating income
Interest income	Included in other income	Included in finance income

For Immediate Release                                                                                               27 May 2009

Cairn India Limited (Consolidated) Financial Results 

For the fifteen month period ended 31 March 2009

The following commentary is provided in respect to the audited financial results and operational achievements of Cairn India Limited and its subsidiary companies (referred to as 'Cairn India') during 2008 - 09.

OPERATIONAL

• Mangala Processing Terminal (MPT) Train one (30,000 barrels of oil per day (bopd) capacity) complete and ready to start production 

• Production to be gradually ramped up through Q3 2009 with arrangements in place for initial dispatch of oil by trucking

• More than 10,000 people deployed on the Rajasthan upstream and pipeline project

• Two drilling rigs and one completion rig operating in the Mangala development area  

• 18 wells drilled of which four wells completed, ready for initial production 

• Train two (50,000 bopd) and Train three (50,000 bopd) construction targeted for completion in Q4 2009 and H1 2010, respectively.   

• Engineering continues for marine export facilities, Train four (75,000 bopd), Bhagyam and Aishwariya fields, to meet production plateau of 175,000 bopd from MBA fields in 2011

• Nine construction spreads working on pipeline with completion target in Q4 2009 

• Government of India (GoI) public sector refiners - MRPL, IOC and HPCL nominated for initial offtake quantities, with discussion ongoing for the additional volumes 

• Price Discussions with GoI nominees for the Rajasthan crude ongoing based on comparable low sulphur crude within the Production Sharing Contract (PSC) framework

• Ravva production reached 200 million barrels benchmark

• CB/OS-2 operations generated its highest revenues during 2008 since production started

• Government of Iraq has pre-qualified Cairn Energy to participate in the second bid round (Greenfield) based amongst other things on the operating capabilities built through Cairn India operations

FINANCIAL

• Gross Operated production for the period ended 31 March 2009; 66,146 barrels of oil equivalent per day (boepd) (Working interest 17,264 boepd)

• Profit after tax of INR 8,035 million (USD 180 million)

• Low field direct operating cost of USD 2.42/barrel

• Fully funded for core Mangala project and pipeline

• Completed draw down of USD 850m debt facility 

The Company has changed its financial year end from 31 December to 31 March to align with tax and joint ventures' financial year and therefore the current financial year consists of a fifteen month period from 1 January 2008 to 31 March 2009. Previous year figures for 12 months are not comparable with the current extended financial year. 

'Cash flow from operations', worked out as profit after tax (excluding other income) prior to non-cash expenses (non-cash employee cost, depreciation, depletion, amortisation, and deferred tax) and exploration cost, was Rs. 8,102 million (USD 182 million) for the current period and was Rs. 6,506 million (USD 157 million) for 2007.  

Cash (net of borrowings) available as at 31 March 2009 was Rs. 23,537 million (USD 462 million). 

The consolidated revenue of Cairn India Limited and its subsidiaries for the current period ended 31 March 2009 was Rs. 14,327 million (USD 321 million) and for the year 2007 was Rs. 10,123 million (USD 245 million). 

The average oil price realisation for the current period was USD 87.5/bbl and for the year 2007 it was USD 74.5/bbl. Average gas price realisation for both the current period and 2007 was USD 4.1/mscf. Average price realisation per boe was USD 69.3 for the current period compared to USD 54.6 for 2007. 

The consolidated Profit before tax (PBT) for the current period was Rs. 9,879 million (USD 221 million) and was Rs. 1,259 million (USD 30 million) in the previous year.  

The consolidated Profit after providing for tax (including deferred tax and FBT) for the current period was Rs. 8,035 million (USD 180 million) as against the loss of Rs. 245 million (USD 6 million) in the previous year. 

Tax (including current tax and deferred tax) is calculated at entity level and not on a consolidated basis; losses arising within one jurisdiction are not available for offset against profits arising in another. 

Amounts shown in USD are converted based on an average exchange rate of 44.61 for the current period and a closing exchange rate of 50.99 as at 31 March 2009.  

Rahul Dhir, Managing Director and Chief Executive Officer, Cairn India said:  

'Cairn India has achieved a major milestone and is ready to produce oil from train one at the Mangala Processing Terminal. 

This is a significant event for both Rajasthan and India as the country's biggest onshore oil discovery for more than two decades is brought on production. 

The company aims to continue to deliver growth and value for all its stakeholders as it develops first the MBA fields and then the additional resources in Rajasthan.'

 CHIEF EXECUTIVE'S REVIEW

Cairn India

Cairn India continues to deliver across all aspects of its business with a focussed strategy that is helping the company grow and create value for shareholders.

The size and scope of the Rajasthan project has substantially increased since the original Mangala discovery in 2004 when peak production was originally forecast at 100,000 bopd. Today the facilities at the MPT will include the phased construction of four processing trains with a production capacity of 205,000 bopd with scope for expansion. 

The Mangala, Bhagyam and Aishwariya (MBA) fields have proven plus probable (2P) gross reserves and resources of 685 million barrels of oil equivalent (mmboe) with a further 300 mmboe of Enhanced Oil Recovery (EOR) potential presently classified as contingent resource. The first production from Rajasthan is scheduled to commence by mid year 2009 and will be evacuated by trucking. The pipeline and significant related terminal facilities are currently being targeted to be ready by Q4 2009. Plateau production from Mangala is planned to reach 125,000 bopd in 2010 with an overall plateau production of 175,000 bopd expected to commence in 2011 from the MBA fields (including Bhagyam, 40,000 bopd, Aishwariya 10,000 bopd). We continue to identify additional growth opportunities in the Barmer basin that provide the potential for further value creation for all stakeholders. 

The Bhagyam field development plan (FDP) was submitted to the Joint Venture (JV) and the Government of India (GoI) in May 2007 and was approved by the GoI in March 2008. Consequently, Bhagyam and Aishwariya reserves were booked in mid 2008. The production potential of Aishwariya has been upgraded from 10,000 bopd to 20,000 bopd subject to regulatory approvals. 

The GoI has confirmed multiple nominees for the Rajasthan crude. The pipeline routing to a nodal point within the existing IOC infrastructure and to a coastal destination gives Cairn India and its JV partner ONGC, access to a wider refining capacity. In order to facilitate the trucking and sale of oil ahead of the pipeline completion, trial runs have been carried out on the route from Mangala to the Gujarat coast.

The producing assets at Ravva and in the Cambay Basin, which are now off peak plateau production, continue to underpin the company and perform better than expected with higher than forecast production and low operating costs. The development wells at Ravva were successfully put on production while in CB/OS-2 the drilling and workover campaign carried out during 2007-08 has transformed the block from a predominately gas to an oil producing asset. The CB/OS-2 fields generated its highest revenues during 2008 since production started. 

Across all assets in India the total reserves and contingent resources (2P + 2C) including Enhanced Oil Recovery (EOR) net to Cairn India is more than 800 million barrels of oil equivalent (mmboe).

Cairn India has continued to grow and establish itself in its second year of listing on the Bombay and National Stock Exchanges with the company one of the key oil and gas exploration and production companies in India.

OPERATIONAL REVIEW

Rajasthan (Block RJ-ON-90/1) (Cairn India 70% (Operator); ONGC 30%)

Overview

Cairn India and its JV partner ONGC now have 3,111 km2 under long term contract on the Rajasthan licence. The main field development area covers 1,859 km2. The Bhagyam and Kameshwari development areas cover 430 km2 and 822 km2 respectively.

The phased, integrated development plan for the block, which includes gas, water and pipeline operations, is focused on the Mangala field with MPT the hub through which all facilities will be connected. 

Good progress has been made on the integrated upstream and midstream development activities at one of the largest onshore oil and gas developments in India. To date the project has achieved more than twenty million lost time injury free hours. 

The facilities to handle a capacity of 30,000 bopd of crude through the first train have been completed at both the MPT in Rajasthan and at the port of Kandla in Gujarat. 

The 2P gross reserves and resources from the three main MBA fields have increased 9% to 685 mmbbls (479 mmbbls net). The other 22 Rajasthan fields including the low permeability Barmer Hill fields provide further scope for continued resource growth.

The Mangala Stock Tank Oil Initially in Place (STOIIP), reserves and resources have been significantly upgraded since the original FDP was approved by the GoI in 2006. The increase in the 2P STOIIP and 2P Reserves and Resources is 21% and 29% respectively over the original Field Development Plan (FDP). The revised FDP was submitted following further drilling in the development area, along with extensive subsurface and detailed design and engineering studies and awaits GoI approval.

During the year the front end engineering design for Bhagyam was completed. The Aishwariya STOIIP has increased to 293 mmbbls. The estimated increased 2P reserves are 64 mmboe supporting a plateau production of 20,000 bopd compared to the 10,000 bopd plan approved in 2006. These estimates are subject to regulatory approvals. 

Development - Upstream 

The Mangala upstream activities are progressing and are at various stages of completion. Train one with a capacity to handle 30,000 barrels of oil per day (bopd) at the MPT is complete and ready to start production. 

The well pads to enable first production have been finished and development drilling and completion is well underway with two multi purpose mobile drilling rigs and one completion rig at the Mangala site. The wells drilled to date have met pre drill expectations and support the planned ramp up production profile for the Mangala field. 

Construction on the second and third trains with a combined capacity of 100,000 bopd is ongoing. 

All of the key elements including facilities and related infrastructure to enable production from the MPT via the pipeline are well underway. This includes key features such as well pads, in-field infrastructure, processing facilities, export facilities, power generation and utilities.

Development - Midstream (Pipeline) - (Cairn India 70% (Operator) ONGC 30%)

The construction of the ~600 km insulated and heated pipeline has nine construction spreads working in Gujarat and Rajasthan. 

The pipeline route through Rajasthan and Gujarat passes through eight districts and more than 250 villages. The final approvals to enable the pipeline construction to proceed and all land purchases for the pipeline above ground installations (AGI's) and main terminals have been completed. Another significant development during this period was the receiving of the Right of Use (RoU) for the Rajasthan leg of the pipeline at the beginning of 2009. 

The major equipment packages were awarded at the beginning of 2008 and all long lead items and materials have been delivered to the site to ensure smooth completion of the final stages of construction. 

The heating stations under construction along the length of the pipeline are well advanced while all the superstructures and main storage tanks at the intermediate pumping station at Viramgam have been built with the ability to distribute to refiners. 

Pre-commissioning and testing activities have commenced on the pipeline with the project targeted for completion in Q4 2009

Crude - Sales 

The GoI has nominated MRPL, IOC and HPCL for the initial offtake quantities from the Rajasthan Block for the period 2009-10 and 2010-11. Discussions are ongoing to allocate the additional volumes.

The oil from Rajasthan is categorised as medium gravity and is of sweet grade with a low sulphur content of about 0.1% by weight. While the crude has a high pour point and viscosity due to its waxy nature, its highly paraffinic nature makes it an excellent secondary processing feedstock for refiners.  

The pricing of the Rajasthan crude, based on comparable low sulphur crude, frequently traded in the region, is at an advanced stage of negotiation with the GoI nominees and is expected to be concluded soon. 

In order to facilitate the sale of oil ahead of completion of the pipeline, it is planned that the crude from the first train at MPT will be trucked to the Gujarat coast and then shipped to MRPL and HPCL. Trial trucking runs have been successfully completed on the route from Mangala to the Gujarat coast. 

The sales to IOC will be by injection into their existing pipeline network in Gujarat. 

Kameshwari Development Area (Cairn India 100%)

The Government of India approved a further Declaration of Commerciality (DoC) and new Development Area of 822 km2 on the Rajasthan licence RJ-ON-90/1 at the end of December 2008 for the Kameshwari West 2, 3 and 6 discoveries. 

Resource base including EOR

Cairn India has made 25 discoveries in the RJ-ON-90/1 block to date and has established a significant growing resource base in the Barmer basin. The company continues its efforts to develop this resource base through the application of appropriate cost efficient technologies. The initial focus has been to develop the MBA fields which contain over two billion barrels in place in the Fatehgarh reservoirs, through primary and secondary recovery schemes. 

Cairn India continues its efforts on the staged and early application of aqueous-based chemical flooding EOR techniques in the MBA fields. Early application of chemical flooding EOR in these fields would be designed to increase the overall recovery from the fields, extend their crude oil production plateau periods, reduce water production, mitigate future decline rates and potentially accelerate crude oil production. Cairn India is actively planning to conduct an EOR pilot trial in the Mangala field following very encouraging results obtained from the laboratory and simulation studies. The current assessment of the EOR resource base is more than 300 mmbbls of incremental recoverable oil from the MBA fields. 

Cairn India will continue with its evaluation of the resources and the development options of the other discoveries, of which the Barmer Hill formation over the Mangala and Aishwariya fields contains around 400 mmbbls of oil in place in tighter reservoir rocks (lower permeabilities). This reservoir has tested oil at rates of up to 250 bopd after stimulation. Analogous fields in the world have been developed with expected ultimate recoveries of 7-20% under primary and secondary recovery schemes. Cairn India is planning to conduct pilot activities to evaluate this additional resource potential and associated development options. 

Cairn India will also continue to consider low cost development options for the smaller fields through the use of cost effective technologies and by leveraging the existing infrastructure. 

Producing Assets

Ravva (Cairn India 22.5% (Operator))

Ravva Field averaged a production rate of 52,539 boepd in the year 2008-09 (comprising of 41,227 bopd and 68 MMscfd of gas). 

An infill drilling campaign was successfully completed in March 2008 comprising of seven development and four exploration/appraisal wells. The development wells were successfully put on production. Information acquired during the drilling campaign along with the reservoir pressure data suggest that there is potential bypassed oil in the field and sub-surface studies are ongoing to identify any additional resources. 

Three oil and gas discoveries were made during the drilling campaign and comprise 3.6 mmboe 2C contingent resources. 

A 14 inch oil pipeline from the RD platform to the Ravva plant was commissioned during this period. The pipeline has facilitated an increase in total liquid production of 4,500 barrels per day. A produced water re-injection project has been successfully commissioned to reduce effluent discharge and enable Ravva to become more eco-friendly.  

Block CB/OS-2: (Cairn India 40% (Operator)) 

In the CB/OS-2 block, the Lakshmi and Gauri offshore fields are currently producing oil and gas, whereas the onshore field, CB-X is only producing gas. The CB/OS-2 field has been on production since October 2002.

The average gross production from the CB/OS-2 block for 2008-09 was 13,607 boepd (7,376 bopd, 37.4 mmscfd of gas). 

The drilling and workover campaign carried out during 2007-08 has transformed the CB/OS-2 block from a predominately gas to an oil producing asset. The onshore facilities were fully up-graded to handle and process 10,000 bopd and the field is currently producing ~ 10,000 bopd (gross). 

The asset has generated its highest revenues, since production started, during 2008 aided by higher oil production from the new wells and the higher oil price realisation.

EXPLORATION OVERVIEW

Proven and probable contingent resource additions for the year 2008 (unaudited) comprised 118% of entitlement production over the same period. 

During the period January 2008 to March 2009 Cairn India operated four of the nine wells in which it participated, three of the operated wells were successful: 

• Raageshwari East-1Z in Rajasthan, the 25th discovery in the Barmer Basin, flowed 500 bopd and 0.4 mmscfd on test from Thumbli sands in a separate oil accumulation adjacent to the Raageshwari field. The discovery was later renamed the Shaheed Tukaram Ombale A.S.I. (Tukaram) field. 

• The Mangala North-1 well extended the contingent resource in the Barmer Hill Formation of the Mangala field. 

• The RB-4 well in Ravva encountered additional oil sands that were later put on stream at 500 bopd through the Ravva production facilities.

Three wells were drilled in CB-ONN-2002/1 one of which made a sub-commercial oil discovery and one well was drilled in each of GV-ONN-2002/1 and GV-ONN-97/1, all of which were dry. The first well in RJ ONN 2003/1 was still operating at the end of March 2009.

Seismic acquisition included both 2D and 3D seismic in blocks KG-ONN-2003/1, and 2D in blocks GV-ONN-2003/1 and VN-ONN-2003/1. Marine 2D seismic surveys were also completed in blocks PR-OSN-2003/1 and KK-DWN-2004/1 in 2008. 

The Government of Sri Lanka awarded Cairn India an exploration licence to explore for oil and natural gas in the Mannar Basin. The block covers approximately 3,000 Km2  in water depths of 200 metres to 1,800 metres. 

At the end of 2008, on going technical evaluation work and the addition of the Sri Lanka licence had helped Cairn India's exploration portfolio grow to over 1,400 mmboe unrisked prospective resources, spread over a the full range of operating environments, risk and basin settings.

Over the next 12 months further drilling and seismic programmes are planned. Drilling is scheduled onshore in the KG basin, with acquisition of 3D seismic totalling 1,800 km2 to commence offshore India and in Sri Lanka. 

Block Updates

Western India - Barmer and Cambay Basins

RJ ON 90/1 (Cairn India 70% (Operator))

Two wells were drilled during Q4 2008 and Q1 2009, both of which discovered oil. Raageshwari East-1Z became the 25th discovery in the block and flowed 500 bopd and 0.4 mmscfd of 40 API oil on test from Thumbli sands in a separate oil accumulation adjacent to the Raageshwari field. The discovery was later renamed the Shaheed Tukaram Ombale A.S.I. (Tukaram) field. 

Additional contingent resources were also added in the Barmer Hill formation as a result of the Mangala North-1 well. 

CB-ONN-2002/1 (Cairn India 30% (ONGC Operator) block relinquished)

A three well drilling programme started in Q3 2008 with the first well completed in August 2008. A small quantity of oil with a flow rate of 100 bopd was recovered from a 2,483-2,479m zone. Two further wells were drilled and both were dry holes. With the completion of the PSC commitments Cairn India has withdrawn from the PSC as the small discovery made with the first well is considered to be non-commercial in size.

Southern India - Krishna-Godavari Basin

Ravva (Cairn India 22.5% (Operator))

The RB-4 well in Ravva drilled as an appraisal of the LM6 sands found to be oil bearing in the RX-8 well drilled in 2007, encountered additional oil sands that were later put on stream at 500 bopd through the Ravva production facilities.

KG-ONN-2003/1 (Cairn India 49% (Operator - exploration phase)) 

Two seismic programmes have been undertaken in this block. The acquisition of a 500 km 2D seismic programme commenced in Q1 2008 followed by the acquisition of a 255km2 3D programme. Drilling is expected to commence in Q4 2009.

KG-DWN-98/2 (Cairn India 10% (ONGC Operator))

The block comprises two Discovery Areas until January 2010 in the south and July 2010 in the North. Three wells have been approved by the JV partnership and the first is expected to spud in 2009.

PR-OSN-2004/1 (Cairn India 35%, (Operator)) 

The acquisition of an offshore 3,100 km 2D seismic programme was successfully completed in Q2 2008. Processing of the data is complete and interpretation continues in support of 3D seismic acquisition that is expected to commence at the end of 2009.

Northern India - Ganga Valley

GV-ONN-97/1 (Cairn India 15% (ONGC Operator) - block relinquished in 2008)

The last commitment well on this block, Banda-1, was completed in Q2 2008 and the block was subsequently relinquished mid year.

GV-ONN-2002/1 (Cairn India 50% (Operator) Capricorn 50%) 

The Havidhi-1 exploration well was drilled in Q1 2009 and completed the remaining work programme commitment in the first exploration phase of the PSC. A decision on further work in this PSC is still being considered.

GV-ONN-2003/1 (Cairn India 49% (Operator - exploration phase) Capricorn 25%)

The acquisition and processing of a 550 km 2D seismic programme was completed in Q1 2009 and interpretation of the new data has commenced.

Other Areas - Vindhyan, Kerala-Konkan and Mjalar Basins

VN-ONN-2003/1 (Cairn India 49% (Operator - exploration phase)) 

The acquisition of a 500 km 2D seismic programme was completed in mid November 2008. Interpretation of the data is ongoing. 

KK-DWN-2004/1 (Cairn India 40% (ONGC, Operator))

A 3,500 km 2D seismic programme was completed in December 2008. 

RJ-ONN-2003/1 (Cairn India 30% (ENI - Operator)) 

The first commitment well spud by the operator at the end of March 2009. Subsequent activity will depend on the outcome of the first well.

Sri Lanka- Mannar Basin

SL 2007-01-001 (Cairn Lanka 100% (wholly owned subsidiary of Cairn India))

A Petroleum Resource Agreement (PRA) for was signed in July 2008 and the PRA became effective when the Petroleum Exploration Licence was signed in October 2008.

The Sri Lankan part of the Mannar basin is an un-explored frontier petroleum province. Subject to the required approvals Cairn India intends to acquire initial seismic data by the end of 2009 or in 2010.

  Cairn India Limited

Registered Office: 101, West View, Veer Savarkar Marg, Prabhadevi

Mumbai - 400025

Corporate Office: 3rd & 4th Floors, Vipul Plaza, Sun City, Sector-54

Gurgaon - 122002

AUDITED CONSOLIDATED FINANCIAL RESULTS 

FOR THE FIFTEEN MONTHS PERIOD ENDED 31ST MARCH 2009

(All amounts are in lakhs of Indian rupees, unless otherwise stated)

Sr. No.	Particulars	Quarter ended 31-Mar-09	Quarter ended 31-Mar-08	Financial Period ended 31-Mar-09 (15 months)	Financial  Year ended 31-Dec-07 (12 months)
		Unaudited	Unaudited	Audited	Audited
1	a) Income from operations	18,175	31,584	143,267	101,226
	b) Other operating income	-	-	-	-
2	Expenditure
	a) (Increase)/Decrease in stock-in-trade	400	(327)	2,223	(1,117)
	b) Operating expenses	3,557	4,663	21,297	19,458
	c) Employees cost	1,704	2,522	11,452	12,574
	d) Depreciation, depletion & amortization	4,430	6,324	26,980	20,771
	e) Share issue expenses	-	-	2,084	-
	f) Administration cost	3,840	1,927	15,235	3,596
	g) Exploration cost	6,267	1,749	16,839	25,123
	h) Foreign exchange fluctuation	736	189	-	21,200
	i) Total	20,934	17,047	96,110	101,605
3	Profit/(Loss) from Operations before Other Income, Interest & Exceptional Items (1-2)	(2,759)	14,537	47,157	(379)
4	Other Income	8,622	2,176	50,716	13,241
5	Profit/(Loss) before Interest & Exceptional Items (3+4)	5,863	16,713	97,873	12,862
6	Interest and finance cost	213	33	641	270
7	Profit/(Loss) after Interest but before Exceptional Items (5-6)	5,650	16,680	97,232	12,592
8	Exceptional Items	-	1,557	1,557	-
9	Profit/(Loss) from Ordinary Activities before tax (7+8)	5,650	18,237	98,789	12,592
10	Tax expense
	a) Current tax	6,160	964	11,108	3,877
	b) Deferred tax	(2,593)	5,541	6,234	7,642
	c) Fringe benefit tax	215	89	1,102	3,527
	d) Total	3,782	6,594	18,444	15,046
11	Net Profit/(Loss) from Ordinary Activities after tax (9-10)	1,868	11,643	80,345	(2,454)
12	Extraordinary items (net of tax expense)	-	-	-	-
13	Net  Profit/(Loss) for the period (11-12)	1,868	11,643	80,345	(2,454)

Sr. No.	Particulars	Quarter ended 31-Mar-09	Quarter ended 31-Mar-08	Financial Period ended 31-Mar-09 (15 months)	Financial  Year ended 31-Dec-07 (12 months)
		Unaudited	Unaudited	Audited	Audited
14	Paid-up Equity Share Capital  (Face value of Rs.10 each)	189,667	177,919	189,667	177,840
15	Reserves excluding Revaluation Reserves				2,756,269
16	Earning/(Loss) per share in rupees  (not annualized)
	a) Basic earnings/(loss) per share	0.10	0.65	4.31	(0.14)
	b) Diluted earnings/(loss) per share	0.10	0.65	4.28	(0.14)
17	Public Shareholding
	- Number of shares	669,824,025	552,347,869	669,824,025	551,555,629
	- Percentage of shareholding	35.32%	31.04%	35.32%	31.01%
18	Promoters and Promoter Group Shareholding
	a) Pledged / Encumbered
	-Number of shares	Nil	Nil	Nil	Nil
	-Percentage of shares (as a % of the total share shareholding of promoter and promoter group)	-	-	-	-
	-Percentage of shares (as a % of the total share capital of the Company)	-	-	-	-
	b) Non-encumbered
	-Number of shares	1,226,843,791	1,226,843,791	1,226,843,791	1,226,843,791
	-Percentage of shares (as a % of the total share shareholding of promoter and promoter group)	100%	100%	100%	100%
	-Percentage of shares (as a % of the total share capital of the Company)	64.68%	68.96%	64.68%	68.99%

Notes:-

1.    The above audited consolidated financial results for the 15 months period ended 31st March 2009 have been reviewed and recommended by the Audit Committee and thereafter approved by the Board of Directors at its meeting held on 27th May 2009. 

2.    The shareholders of the Company had approved the change of financial year end from 31st December to 31st March. Therefore, the current financial year consists of fifteen months period from 1st January 2008 to 31st March 2009. Subsequent financial years would be for twelve months period ending 31st March every year. Accordingly, previous year figures are not comparable with current period figures.

3.    The Company and its subsidiaries operate in only one segment i.e. 'Oil and Gas Operations'.

4.    Employee costs include a charge of INR 204 lakhs for the quarter and INR 2,902 lakhs for fifteen months period ended 31st March 2009, representing the amortization of employee compensation expenses pertaining to Employee Stock Option Schemes of the Company. Following is the summary of options existing, granted, exercised and cancelled during the fifteen months period- 

	Particulars	Equity-settled Employee Stock Option Schemes	Cash-settled Employee Stock Option Schemes
(a)	Options outstanding at the beginning of the period	21,599,667	Nil
(b)	New options granted during the period	4,599,463	1,185,423
(c)	Options exercised and shares allotted during the period	5,268,396	Nil
(d)	Options cancelled during the period	4,578,317	38,008
(e)	Options outstanding at the end of the period	16,352,417	1,147,415

The Company had decided to retrospectively account for stock option using the Intrinsic Value Method as against the Fair Value Method (Black Scholes) followed till the financial year ended 31st December 2007. Accordingly, the excess stock option provision up to 31st December 2007 was reversed during the current period, resulting in an exceptional gain of INR 1,557 lakhs. Further, the stock option charge for the current quarter and fifteen months period ended 31st March 2009 (included in employee cost) is lower by INR 822 lakhs and INR 3,327 lakhs respectively due to this change.

5.    Exploration costs include costs pertaining to geological/geophysical studies, seismic studies, other surveys and unsuccessful wells. These costs have been charged to the profit and loss account as per the provisions of the Successful Efforts Method of accounting for acquisition, exploration and development costs prescribed under the Guidance Note on Accounting for Oil and Gas Producing Activities, issued by the Institute of Chartered Accountants of India. 

6.    Other income for the fifteen months period ended 31st March 2009 includes (a) Income from investments of INR 33,265 lakhs (b) Foreign exchange fluctuation of INR 16,018 lakhs, representing the net gain arising on settlement and translation of foreign currency monetary items at the rate prevailing at the end of the reporting date and the cost arising on the USD/INR options (taken for hedging the foreign currency risks of the group) settled, cancelled or marked-to-market as at 31st March 2009 (c) Other miscellaneous income of INR 1,433 lakhs. 

7.    During the fifteen months period, the paid-up equity share capital has increased to INR 1,89,667 lakhs subsequent to the allotment of equity shares under preferential allotment and upon exercise of options under Cairn India Senior Management Plan.

8.    The share issue expenses of INR 2,084 lakhs incurred on the preferential allotment of 113,000,000 equity shares have been charged to the profit and loss account and not adjusted from the securities premium account on conservative basis. 

9.    The current tax and deferred tax provisions have been computed on the basis of the standalone financial statements of the Company's subsidiaries, i.e. not based on the consolidated financial statements of Cairn India Limited and its subsidiaries. The fringe benefit tax includes the provision made on employee stock options, which are worked out on the basis of number of options expected to be exercised and the share price prevailing on the reporting date.

10.    Previous quarter / year figures have been regrouped / rearranged wherever necessary to conform to the current quarter / period's presentation.

	For and on behalf of the Board of Directors
Place: Gurgaon	Rahul Dhir
Date: 27th May 2009	Managing Director and Chief Executive Officer

 Cairn India Limited

Registered Office: 101, West View, Veer Savarkar Marg, Prabhadevi

Mumbai - 400025

Corporate Office: 3rd & 4th Floors, Vipul Plaza, Sun City, Sector-54

Gurgaon - 122002

AUDITED STANDALONE FINANCIAL RESULTS 

FOR THE FIFTEEN MONTHS PERIOD ENDED 31ST MARCH 2009

(All amounts are in lakhs of Indian rupees, unless otherwise stated)

Sr. No.	Particulars	Quarter ended 31-Mar-09	Quarter ended 31-Mar-08	Financial Period ended 31-Mar-09 (15 months)	Financial  Year ended 31-Dec-07 (12 months)
		Unaudited	Unaudited	Audited	Audited
1	a) Income from operations	34	89	373	127
	b) Other operating income	-	-	-	-
2	Expenditure
	a) (Increase)/Decrease in stock-in-trade	-	-	-	-
	b) Operating expenses	-	361	362	-
	c) Employees cost	(80)	1,472	2,125	6,234
	d) Depreciation, depletion & amortization	1	-	4	-
	e) Legal & professional charges	378	381	2,823	1,390
	f) Share issue expenses	-	-	2,084	-
	g) Administration cost	248	174	1,222	358
	h) Exploration cost	2,812	745	8,136	89
	i) Foreign exchange fluctuation	725	-	1,806	-
	j) Total	4,084	3,133	18,562	8,071
3	Profit/(Loss) from Operations before Other Income, Interest & Exceptional Items (1-2)	(4,050)	(3,044)	(18,189)	(7,944)
4	Other Income	6,899	620	27,873	3,269
5	Profit/(Loss) before Interest & Exceptional Items (3+4)	2,849	(2,424)	9,684	(4,675)
6	Interest and finance cost	27	-	34	2
7	Profit/(Loss) after Interest but before Exceptional Items (5-6)	2,822	(2,424)	9,650	(4,677)
8	Exceptional Items	-	1,557	1,557	-
9	Profit/(Loss) from Ordinary Activities before tax (7+8)	2,822	(867)	11,207	(4,677)
10	Tax expense
	a) Current tax	4,468	-	5,438	-
	b) Deferred tax	-	-	-	-
	c) Fringe benefit tax	44	6	345	3,205
	d) Total	4,512	6	5,783	3,205
11	Net Profit/(Loss) from Ordinary Activities after tax (9-10)	(1,690)	(873)	5,424	(7,882)
12	Extraordinary items (net of tax expense)	-	-	-	-
13	Net  Profit/(Loss) for the period (11-12)	(1,690)	(873)	5,424	(7,882)

Sr. No.	Particulars	Quarter ended 31-Mar-09	Quarter ended 31-Mar-08	Financial Period ended 31-Mar-09 (15 months)	Financial  Year ended 31-Dec-07 (12 months)
		Unaudited	Unaudited	Audited	Audited
14	Paid-up Equity Share Capital  (Face value of Rs.10 each)	189,667	177,919	189,667	177,840
15	Reserves excluding Revaluation Reserves				2,750,037
16	Earning/(Loss) per share in rupees  (not annualized)
	a) Basic earnings/(loss) per share	(0.09)	(0.65)	0.29	(0.44)
	b) Diluted earnings/(loss) per share	(0.09)	(0.65)	0.29	(0.44)
17	Public Shareholding
	- Number of shares	669,824,025	552,347,869	669,824,025	551,555,629
	- Percentage of shareholding	35.32%	31.04%	35.32%	31.01%
18	Promoters and Promoter Group Shareholding
	a) Pledged / Encumbered
	-Number of shares	Nil	Nil	Nil	Nil
	-Percentage of shares (as a % of the total share shareholding of promoter and promoter group)	-	-	-	-
	-Percentage of shares (as a % of the total share capital of the Company)	-	-	-	-
	b) Non-encumbered
	-Number of shares	1,226,843,791	1,226,843,791	1,226,843,791	1,226,843,791
	-Percentage of shares (as a % of the total share shareholding of promoter and promoter group)	100%	100%	100%	100%
	-Percentage of shares (as a % of the total share capital of the Company)	64.68%	68.96%	64.68%	68.99%

Notes:-

1.    The above audited financial results for the fifteen months period ended 31st March 2009 have been reviewed and recommended by the Audit Committee and thereafter approved by the Board of Directors at its meeting held on 27th May 2009. 

2.    The shareholders of the Company had approved the change of financial year end from 31st December to 31st March. Therefore, the current financial year consists of fifteen months period from 1st January 2008 to 31st March 2009. Subsequent financial years would be for twelve months period ending 31st March every year. Accordingly, previous year figures are not comparable with current period figures.

3.    The Company operates in only one segment i.e. 'Oil and Gas Operations'

4.    Employee cost for the current quarter includes a net credit of INR 218 lakhs (due to cancellation of options for employees who have left the organization and change in performance based vesting date assumption) and a charge of INR 1,224 lakhs for the fifteen months period ended 31st March 2009, representing the amortization of employee compensation expenses pertaining to equity-settled Employee Stock Option Schemes.  

The Company has offered certain share options to some of the employees of one of its subsidiary companies and it was bearing the charge in its profit and loss account till 31st March 2008. With effect from 1st April 2008, the Company decided that this charge would be borne by the immediate employer company of those employees. Accordingly, the stock option charge for the current quarter and fifteen months ended 31st March 2009 is lower by INR 308 lakhs and INR 1,406 lakhs respectively. Following is the summary of options existing, granted, exercised and cancelled during the quarter-

	Particulars	Equity-settled Employee Stock Option Schemes
(a)	Options outstanding at the beginning of the fifteen months period	21,599,667
(b)	New options granted during the period	4,599,463
(c)	Options exercised and shares allotted during the period	5,268,396
(d)	Options cancelled during the period	4,578,317
(e)	Options outstanding at the end of the period	16,352,417

During the current year, the Company decided to retrospectively account for stock option using the Intrinsic Value Method as against the Fair Value Method (Black Scholes) followed till the financial year ended 31st December 2007. Accordingly, the excess stock option provision up to 31st December 2007 was reversed during the quarter ended 31st March 2008, resulting in an exceptional gain of INR 1,557 lakhs. Further, the stock option charge for the current quarter and fifteen months ended 31st March 2009 (included in employee cost) is lower by INR 807 lakhs and INR 3,294 lakhs respectively due to this change.

5.    Exploration costs include costs pertaining to geological/geophysical studies, seismic studies, other surveys and unsuccessful wells. These costs have been charged to the profit and loss account as per the provisions of the Successful Efforts Method of accounting for acquisition, exploration and development costs prescribed under the Guidance Note on Accounting for Oil and Gas Producing Activities issued by the Institute of Chartered Accountants of India. 

6.    Other income represents income from investments made by the Company in mutual funds and bank deposits. 

7.    The fringe benefit tax includes the provision made on employee stock options, which is worked out on the basis of options outstanding and the share price prevailing on the reporting date.

8.    The number of investors' complaints received and disposed of during the quarter ended 31st March 2009 were as follows-

(a)	Pending at the beginning of the quarter	1
(b)	Received during the period	23
(c)	Disposed of during the period	24
(d)	Pending at the end of the quarter	Nil

9.    During the fifteen months period, the paid-up equity share capital has increased to INR 1,89,667 lakhs subsequent to the allotment of equity shares under preferential allotment and upon exercise of options under Cairn India Senior Management Plan.

10.    The share issue expenses of INR 2,084 lakhs incurred on the preferential allotment of 113,000,000 equity shares have been charged to the profit and loss account and not adjusted from the securities premium account on conservative basis. 

11.    As at 31st March 2009, the Company and its subsidiaries together have utilized INR 825,631 lakhs for the purposes listed in the IPO prospectus, as against the projected utilization of Rs.882,489 lakhs. The funds utilized till 31st March 2009 were as follows-

	Particulars	Rupees in lakhs
(a)	Acquisition of shares of Cairn India Holdings Limited from Cairn UK Holdings Limited	595,808
(b)	Exploration and Development expenses	211,527
(c)	General corporate purposes	2,300
(d)	Issue expenses	15,996

12.    Previous quarter / year figures have been regrouped / rearranged wherever necessary to confirm to the current quarter/period's presentation.

	For and on behalf of the Board of Directors
Place: Gurgaon	Rahul Dhir
Date: 27th May 2009	Managing Director and Chief Executive Officer

 Enquiries to:

Analysts/Investors

Anurag Mantri, Group Financial Controller    [phone]  

Media

Manu Kapoor, Director, Corporate Affairs    [phone]

About Cairn India Limited

• 'Cairn India' where referred to in the release means Cairn India Limited and/or its subsidiaries, as appropriate. 

• Cairn Lanka (Private) Limited, is a wholly owned subsidiary of Cairn India that holds a 100% participating interest in the Mannar block.

• 'Cairn' where referred to in this release means Cairn Energy PLC and/or its subsidiaries (including Cairn India), as appropriate. 

• Cairn India is headquartered in Gurgaon on the outskirts of Delhi, with operational offices in Chennai, Gujarat, Andhra Pradesh and Rajasthan.

• On 9 January 2007, Cairn successfully concluded the flotation of its Indian business with the commencement of trading of Cairn India Limited on the Bombay Stock Exchange and the National Stock Exchange of India. Cairn Energy PLC currently holds a 65% shareholding in Cairn India Limited. 

• Cairn India holds material exploration and production positions in 13 blocks in west India and east India along with new exploration rights elsewhere in India and Sri Lanka.

• This focus on India has already resulted in a significant number of oil and gas discoveries.  In particular, Cairn made a major oil discovery (Mangala) in Rajasthan in the north west of India at the beginning of 2004. More than 20 discoveries have been made in Rajasthan block RJ-ON-90/1. 

• In Rajasthan, Cairn India operates Block RJ-ON-90/1 under a Production Sharing Contract (PSC) signed on 15 May 1995. The main Development Area (1,858 km2), which includes Mangala, Aishwariya, Saraswati and Raageshwari is shared between Cairn India and ONGC, with Cairn India holding 70% and ONGC having exercised their back in right for 30%. A further Development Area (430 km2), including the Bhagyam and Shakti fields, is also shared between Cairn India and ONGC in the same proportion.

• The Operating Committee for Block RJ-ON-90/1 consists of Cairn India and ONGC.

• India currently imports more than 2,000,000 barrels of oil per day (bopd).  It produces approximately 700,000 bopd itself of which approximately 50,000 bopd comes from the Cairn India operated Ravva field on the east coast of India

• For further information on Cairn India Limited see www.cairnindia.com
  

Glossary

Corporate 

Cairn India/CIL	Cairn India Limited and/or its subsidiaries as appropriate
Company	Cairn India Limited
DoC	Declaration of Commerciality
JV	Joint Venture
MBA	Mangala, Bhagyam and Aishwariya
MPT	Mangala Processing Terminal
MRPL	Mangalore Refinery and Petrochemicals Limited, (subsidiary of ONGC)
IOC	Indian Oil Corporation
HPCL	Hindustan Petroleum Corporation Limited
E&P	exploration and production
GoI	Government of India
Group	the Company and its subsidiaries
ONGC	Oil and Natural Gas Corporation Limited

Technical

2P	proven plus probable
3P	proven plus probable and possible
2D/3D	two dimensional/three dimensional
boe	barrel(s) of oil equivalent
boepd	barrels of oil equivalent per day
bopd	barrels of oil per day
bscf	billion standard cubic feet of gas
EOR	enhanced oil recovery
FDP	field development plan
mmboe	million barrels of oil equivalent
mmscfd	million standard cubic feet of gas per day
PSC	production sharing contract

The Fatehgarh is the name given to the primary reservoir rock of the Northern Rajasthan fields of Mangala, Aishwariya and Bhagyam. 

The Barmer Hill is a lower permeability reservoir which overlies the Fatehgarh. 

The Dharvi Dungar forms the secondary reservoirs in the Guda field and is the reservoir rock encountered in the recent Kameshwari West discoveries. 

The Thumbli forms the youngest reservoirs encountered in the basin. The Thumbli is the primary reservoir for the Raageshwari field.

These materials contain forward-looking statements regarding Cairn India, our corporate plans, future financial condition, future results of operations, future business plans and strategies. All such forward-looking statements are based on our management's assumptions and beliefs in the light of information available to them at this time. These forward-looking statements are, by their nature, subject to significant risks and uncertainties and actual results, performance and achievements may be materially different from those expressed in such statements. Factors that may cause actual results, performance or achievements to differ from expectations include, but are not limited to, regulatory changes, future levels of industry product supply, demand and pricing, weather and weather related impacts, wars and acts of terrorism, development and use of technology, acts of competitors and other changes to business conditions. Cairn India undertakes no obligation to revise any such forward-looking statements to reflect any changes in Cairn India's expectations with regard thereto or any change in circumstances or events after the date hereof. Unless otherwise stated the reserves and resource numbers within this presentation represent the views of Cairn India and do not represent the views of any other party, including the Government of India, the Directorate General of Hydrocarbons or any of Cairn India's joint venture partners.

 

END

 

 

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