Drilling Report

Cairn Energy PLC
21 August 2000


                               CAIRN ENERGY PLC                               
                                               
                
The following release was issued by Shell Bangladesh Exploration and
Development B.V. on Saturday 19 August 2000:-

Shell Starts Drilling Sandwip East 1

Shell Bangladesh Exploration and Development B.V. (SBED) has commenced the
drilling of Sandwip East 1 offshore well located in the Bay of Bengal. The
drilling started on Saturday, 19 August. The well is an exploration well
targeted at seeking new gas to add to the growing reserve base of Bangladesh.

A special drilling ceremony was conducted Friday 18 August, attended by
representatives of Petrobangla and Shell Bangladesh Exploration and
Development B.V.

The drilling of the well commenced upon positioning the rig in the exploration
area. Earlier, the rig was successfully moved 53 kms from its location at
South Sangu 1. It is for the first time in the history of Bangladesh that a
rig has been moved this far north and also the first time a rig has been moved
in the Bay of Bengal during peak monsoon season.

Sandwip East 1 is being drilled under the Block 15 Production Sharing Contract
(PSC) with Petrobangla in a joint venture with Cairn Energy PLC. 


Enquiries:

Cairn Energy PLC                                          

Bill Gammell, Chief Executive                                    0131 475 3000
Dr Mike Watts,  Exploration Director                             0131 475 3000