Cairn Updates Operations Offshore Greenland

- Cairn Updates Operations Offshore Greenland

Tuesday, September 13, 2011
Cairn Energy plc

The following operational update relates to Cairn's exploration drilling campaign offshore Greenland.

Gamma-1 Well: Eqqua Block, West Disko Area

The Gamma-1 exploration well, drilled by the Ocean Rig Corcovado drillship, located in 1,520 meters (m) of water and 294 kilometers (km) from Aasiaat, in the Eqqua Block in the West Disko area has reached total depth (TD) and preparations are under way to plug and abandon the well. The well had been targeted to test a deep water Tertiary basin floor fan located 100km down dip from the T8-1 well where biogenic and thermogenic gas had been encountered in 2010.

The Gamma-1 well intersected the prognosed basin floor fan at the anticipated depth, although no reservoir or hydrocarbon shows were encountered in the interval.

Delta-1 Well: Napariaq Block, West Disko Area

The Delta-1 exploration well, drilled by the Leiv Eiriksson semisubmersible drilling rig, located in a water depth of 293m and approximately 365km offshore Aasiaat, in the Napariaq Block is currently drilling ahead. The Delta-1 well is aiming to intersect Cretaceous sediments in a large structural closure beneath the Tertiary volcanic interval in which oil shows were encountered in the Alpha-1 well drilled in 2010. The well has so far encountered several hundred meters of Tertiary volcanic section, which is thicker than anticipated and with only minor hydrocarbon indications. A further update will be made later this month, once the well reaches TD.

AT7-1 Well: Atammik Block, South Ungava Area

Following completion of the operations on the Delta-1 Well, the Leiv Eiriksson is scheduled to move south to re-enter the AT7-1 well in the Atammik block, located in 909m of water and 198km offshore Nuuk, and drill to the planned TD.

Fifth Well: AT2 Prospect: Atammik Block, South Ungava Area

Once operations on the Gamma-1 well are complete, the Ocean Rig Corcovado is scheduled to move 597km south, to the Atammik Block, to drill the AT2 prospect as a fifth well in the 2011 exploration drilling campaign.

Further updates will be provided whenever a well is at TD and operations are complete.

Simon Thomson, Chief Executive, said, "The full results of the Gamma-1 well and the update from the Delta-1 well will be reviewed in the context of all the data gathered during the Greenland exploration campaign.

The rigs are scheduled to move south to drill the final two wells of the program on the Atammik block. We remain focused on the potential of our multi-basin position in Greenland."

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Cairn to Abandon Well Offshore Greenland

- Cairn to Abandon Well Offshore Greenland

Wednesday, August 03, 2011
Cairn Energy

The following operational update relates to Cairn Energy's exploration drilling campaign offshore Greenland.

LF7-1 Well: Lady Franklin Block, South Ungavva Area

The LF7-1 exploration well, located in 1,002 meters (m) of water approximately 300 kilometers (km) offshore Nuuk, has reached target depth (TD) in basement strata and preparations are under way to plug and abandon the well. The well encountered a thick Upper Cretaceous section with tight (cemented) sandstones although the anticipated stratigraphically deeper reservoir section was absent at this location. Initial geochemical analysis of the background gas composition indicates the presence of pre-Tertiary oil prone source rocks in the basin.

The Ocean Rig Corcovado is currently carrying out abandonment operations on the LF7-1 well.

AT7-1 Well: Atammik Block, South Ungavva Area

The AT7-1 exploration well in the Atammik Block, located in 909m of water 200km offshore Nuuk, has been temporarily suspended by the Leiv Eriksson. The AT7-1 well is currently suspended above the prognosed target objectives and the well is scheduled to be re-entered and drilled to planned TD at a later date in the current program. With the opening of the weather window in the Disko area the Leiv Eriksson was moved 750km north to commence operations on the Delta prospect in the Napariaq Block, optimizing the program.

Delta-1 Well: Napariaq Block, West Disko Area

The Delta-1 well has spudded on the Delta prospect, located in a water depth of 293m approximately 100km off the Greenland coast and 110km northeast of the Alpha-1S1 well drilled by Cairn in the Sigguk Block in 2010.

Gamma Prospect: Eqqua Block, West Disko Area

The Gamma prospect in the Eqqua block, located in 1,520m of water and 110km southwest of the Alpha-1S1 well is scheduled to be drilled using the Ocean Rig Corcovado after operations on LF7-1 are complete.

A further update will be provided whenever a well is at TD and operations are complete.

Simon Thomson, Chief Executive, said, "Although no reservoir has been found in the LF7-1 well, the first in the basin, we are encouraged by further indications of pre-Tertiary oil-prone source rocks across our Greenland acreage. The exploration challenge remains to find the reservoir sands. We continue to be optimistic about the remainder of our 2011 four-well, multi-basin exploration program offshore Greenland."

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Cairn Energy CEO Steps Down amid Sweeping Board Changes

- Cairn Energy CEO Steps Down amid Sweeping Board Changes

Thursday, June 16, 2011
Dow Jones Newswires
LONDON
by Alexis Flynn

Cairn announced a sweeping overhaul of its senior management team, as the company looks to strengthen its exploration emphasis following the expected completion of a delayed transaction in India.

Cairn said its founder and long-standing chief executive, Sir Bill Gammell, will relinquish his position at the helm of the Edinburgh-based oil and gas explorer in favor of Legal and Commercial Director Simon Thomson. Gammell will in turn replace Norman Murray as chairman, who leaves to take up the same position at oil and gas services company Petrofac Ltd. (PFC.LN).

Two other board members will also step down. The company will retain some other figures, including Deputy Chief Executive Mike Watts, a leader in its exploration venture.

The changes come amid expectations that Cairn will soon close a deal to sell a majority stake in its India unit to Vedanta Resources. The time-frame of the Vedanta deal, worth about $9.6 billion in cash, has been delayed amid a royalty dispute with the Indian government. Indian Oil Minister Jaipal Reddy said recently the matter could be discussed at a cabinet meeting later this month.

Following the reorganization, Gammell, 58, will retain his position as chairman of Cairn India, tasked with overseeing the successful conclusion of the company's India deal.

In addition to the change to the firm's top leadership, Cairn said two other board members would be stepping down. Chief Operating Officer Malcolm Thoms and Engineering and Operations Director Philip Tracy will also depart, said Cairn.

Finance Director Jann Brown will take up the position of managing director, reporting to new CEO Thomson.

"Cairn's key strength of entrepreneurial exploration remains the focus, offering investors significant growth potential in combination with underlying asset value and balance sheet strength," said Thomson.

Cairn shares were lower in line with other U.K. oil producers following the announcement. At 1107 GMT, they were down 8 pence, or 1.9%, at 403p, underperforming the broader FTSE 100 index, which was down 1.1%.

Deutsche Bank said it viewed the changes "to be a constructive step forward that is focused on energizing the group for its next steps of growth."

Deutsche highlighted the fact that Watts will remain as a positive. Watts has been the architect of Cairn's Greenland operations, where the company is currently drilling exploratory offshore wells.

Copyright (c) 2011 Dow Jones & Company, Inc.

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Cairn Spuds Wells Offshore Greenland

- Cairn Spuds Wells Offshore Greenland

Friday, June 03, 2011
Cairn Energy

Cairn has commenced drilling operations on two wells offshore West Greenland.

The AT-7 well in the Atammik Block, approximately 160 kilometers offshore Nuuk, west Greenland and the LF-7 well in the Lady Franklin Block approximately 300 kilometers offshore Nuuk have both started operating.

The Leiv Eiriksson, a fifth generation semi submersible and the Ocean Rig Corcovado, a sixth generation drillship, are to carry out the drilling program offshore Greenland this summer.

The AT-7 prospect in the Atammik Block and LF-7 prospect in the Lady Franklin Block are in water depths of 905 and 989 meters respectively.

An update on the drilling operations will be provided in due course.

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Cairn Energy Files Injunction to Stop Greenpeace Rig Protests

- Cairn Energy Files Injunction to Stop Greenpeace Rig Protests

Thursday, June 02, 2011
Dow Jones Newswires
by Alexis Flynn

Cairn has filed for an injunction against environmental group Greenpeace and two Dutch-registered vessel owners in an attempt to prevent activists from further disrupting its drilling activities offshore Greenland, the Edinburgh-based oil and gas explorer said Thursday.

Cairn "cannot allow any action that poses a potential threat to the safety of our employees or the protesters involved," the company said.

Greenpeace confirmed legal proceedings against the group had begun. It said Cairn is seeking fines of EUR2 million a day for every day its operations are affected after Monday if the injunction is granted.

"Cairn is trying to use a legal hammer to shut down our campaign to kick the oil companies out of the Arctic, but we'll challenge Cairn and its lawyers every step of way," said Greenpeace campaigner Ben Ayliffe.

Cairn said it was requesting the order from an Amsterdam court to stop the future disruption of its "lawful operations offshore Greenland."

Copyright (c) 2011 Dow Jones & Company, Inc.

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Cairn India Reports Record Quarterly Profit

- Cairn India Reports Record Quarterly Profit

Wednesday, May 25, 2011
Cairn India Ltd.

The following commentary is provided in respect of the audited financial results and operational highlights of Cairn India Limited and its subsidiary companies (referred to as Cairn India) during the financial year 2010-11 (FY 2010-11). Please note that FY 2010-11 refers to the period April 2010 - March 2011.

• FINANCIAL HIGHLIGHTS
  • Revenue in Q4 FY 2010-11 at R 36,545 million (US $808 million); FY 2010-11 at R 102,779 million (US $2,255 million)
  • Profit after tax (PAT) in Q4 FY 2010-11 at R 24,578 million (US $543 million); FY 2010-11 at R 63,344 million (US $1,390 million)
  • Cash Flow from Operations in Q4 FY 2010-11 at R 26,110 million (US $577 million); FY 2010-11 at R 67,122 million (US $1,473 million)
  • Net Cash of R 29,070 million (US $651 million) as on 31 March, 2011
  • Gross cumulative Rajasthan development capital expenditure at US $2,995 million of which US $703 million was spent during FY 2010-11
• OPERATIONAL HIGHLIGHTS
  • Average Daily Sales (Working Interest) for Q4 FY 2010-11 at 96,417 barrels of oil equivalent (boe); FY 2010-11 at 81,254 boe
  • Average Daily Gross operated production for Q4 FY 2010-11 at 161,194 boe; FY 2010-11 at 149,103 boe
  • Maintained low cost operations; field direct opex at US $2.3 per barrel (bbl) for FY 2010-11
  • Gross crude oil production in excess of 13 million barrels (mmbbls) from operated assets in Q4FY 2010-11; contributing ~20% of India's current domestic crude production
  • Won the "Golden Peacock Award for Corporate Social Responsibility" for the year 2011
• Rajasthan
  • Mangala Field
    • Current production at 125,000 barrels of oil per day (bopd); cumulative crude sales in excess of 39 mmbbls to Indian refiners
    • Development drilling progresses as planned; 143 wells drilled to date, 85 completed and 62 producing

Cairn to Resume Drilling Ops Offshore Greenland

- Cairn to Resume Drilling Ops Offshore Greenland

Tuesday, May 24, 2011
Cairn Energy

Following Cairn's three-well drilling operations in 2010; the Company's exploration campaign is to continue in 2011 with the drilling of up to four further exploration wells. The Government of Greenland has recently approved the location of seven exploration drill sites which allows some flexibility in program planning and possible options for follow up appraisal wells in the event of a discovery.

The main elements of the primary 2011 exploration program are:

• The drilling of up to four exploration wells, with one in each of the Atammik and Lady Franklin blocks offshore to the west of the capital Nuuk, and one in each of the Napariaq and Eqqua blocks in the southern Baffin Bay west Disko area;
• The acquisition of up to three 3D seismic surveys (combined total ~ 4,500km2), one in the north of Baffin Bay, one in the south of Greenland and one contingent location to be decided dependent on operational results.
• The four well campaign will test prospects with different structural styles and play types and is targeting a gross unrisked mean prospective resource potential of 3.2 billion barrels of oil equivalent at target subsurface depths between 2,500 and 4,750 meters.
• In each case the principal target is oil but evidence of both oil and gas generation is found regionally. In view of the frontier nature of the exploration and paucity of offset well information the individual prospects are estimated to have chances of success ranging from around 10% to 20%. The wells will be drilled in water depths ranging between 288 meters and 1,530 meters.

As was the case in 2010, the program will be carried out with a focus on safety, including the deployment of two drilling vessels.

The total cost of the drilling campaign is estimated to be in the region of $600MM, in line with previous guidance.

Atammik and Lady Franklin Blocks

Cairn increased its equity and acquired the operatorship of these blocks with effect from 1 January 2011.

The final selection of prospects for the 2011 exploration campaign is the LF-7 prospect in the Lady Franklin block and the AT-7 prospect in the Atammik block. Both prospects contain multiple structural targets in the Tertiary and Cretaceous sections, with expected mean prospective resources of 480 and 350 mmbbls respectively, with the probability of success estimated to range from around 10% to 20% dependent on the individual target horizons. The planned TD of the AT-7 prospect well is 3600m and 4,500 meters for the LF-7 prospect well.

Follow-up prospects are present in both blocks with an estimated combined gross mean in-place resource of more than eight billion barrels or 14 Tcf.

Napariaq

This block was awarded to Cairn in the Baffin Bay Bid round the results of which were announced by the Government of Greenland in December 2010.

The exploration well in this block will target the Delta prospect, which is a large structural culmination in the Cretaceous section where the overlying Tertiary volcanics are prognosed to be thin or possibly even absent. The Delta Prospect has an expected mean prospective resource of 530 mmbbls and probability of success estimated at around 10%. The potential for stacked pay could add further volumes to these estimates. The well is scheduled to be drilled to a depth of 4,750 meters and targets the potential reservoirs of Cretaceous age not reached in the Alpha-S1 well drilled in 2010. The Alpha-S1 well encountered oil shows in the thick (>1 km) Tertiary volcanic section. Geochemical analysis of the oil samples confirm three types of oil one of which comes from a pre-Tertiary source rock which is presumed Cretaceous in age as it has similarities with known Cretaceous oil seeps seen onshore in the Disko area. The Delta well is important for understanding the potential of a regional Cretaceous play in the offshore Disko area.

Eqqua

The Eqqua block lies to the south of the Sigguk block where the 2010 activities were focused and it was acquired by Cairn in the Disko West license round in late 2007.

The Gamma prospect in the Eqqua block is a combination structural-stratigraphic trap in an interpreted Tertiary basin floor fan at 2,500 meters overlying a deeper Mesozoic structural culmination at around 4,500 meters. The fan targets potentially thicker reservoir sands 100 km from the T-8 well but at the same stratigraphic level as the gas seen in thin sands in the T-8 well drilled in 2010. The Tertiary Gamma Prospect has a mean prospective resources of 1,840 mmbbls or 7 Tcf and probability of success of around 10%. The planned Gamma well is not designed to drill to the deeper Mesozoic target this year as this prospect will require proof of offshore Cretaceous reservoirs from the Napariaq Delta prospect well.

Pitu and Southern Greenland blocks

The Pitu block was acquired in the December 2010 Baffin Bay Bid round, the southern Greenland blocks were acquired in 2008.

Two 1,500km2 3D seismic surveys are planned to be acquired in each of these areas over structural complexes where leads and prospects with material potential have been identified.

The location of a third and contingent 3D seismic survey is yet to be decided and is dependent on operational results.

Mike Watts, Deputy Chief Executive, Cairn Energy, said, "The Group's strong financial position and entrepreneurial exploration focus has allowed it to build a strategic and leading early entry position in the frontier offshore basins of Greenland, which Cairn believes has the necessary geological ingredients for exploration success."

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Petronas Sells Cairn India Stake for $2.1B

Petronas Sells Cairn India Stake for $2.1B

Tuesday, April 19, 2011
Dow Jones Newswires
by Ankur Relia, Raghavendra Upadhyaya & Eric Yep

Malaysia's Petroliam Nasional Berhad, or Petronas, Tuesday said it exited Cairn India by selling its entire 14.94% stake in the oil and gas explorer for about $2.1 billion.

Petronas held 283.4 million shares in the Indian unit of Cairn through its overseas arm Petronas International Corp.

"The transaction brings to a close a successful association as a shareholder with Cairn India since 2006," Petronas said in a statement.

Petronas had raised its holding in Cairn India to 14.94% in 2009-10 after acquiring a 2.3% stake from Cairn Energy.

Petronas didn't reveal the names of the buyers but a person with knowledge of the matter told Dow Jones Newswires that the stake was sold to India-focused miner Vedanta and institutional investors in India via block deals.

Bank of America Merrill Lynch was the sole adviser on the deal, said the person, who declined to be named.

The stake sale by Petronas brings Vedanta closer to its goal of acquiring a majority stake in Cairn India as analysts don't expect a big response to Vedanta's open offer. Petronas' sale may also allow Edinburgh-based explorer Cairn Energy to retain a larger stake in Cairn India.

In August last year, Vedanta had offered to buy a 51%-60% stake in the Indian unit of Cairn Energy, in a deal expected to cost up to $9.6 billion.

The deal is awaiting approval from the Indian government.

Cairn Energy owns a 62.37% stake in Cairn India.

Vedanta has proposed to acquire up to 51% of Cairn India from its U.K. parent for INR405 a share. Vedanta unit Sesa Goa launched an open offer on April 11 for up to 20% of Cairn India from minority shareholders at INR355 a share. The open offer price doesn't include the INR50 non-compete fee that Vedanta had offered to Cairn Energy.

The open offer closes on April 30. Shares of Cairn India, which had earlier risen to as much as INR370, closed up 2.3% on Tuesday at INR344.25.

Vedanta, Cairn Energy and Cairn India didn't immediately respond to queries.

Earlier Tuesday, data on Factset showed that about 283.43 million shares of Cairn India were traded through block deals on the Bombay Stock Exchange. The three largest deals were for 265.19 million shares traded at a weighted average price of INR331.08 apiece, 12.08 million shares at INR331.08 each and 5.07 million shares at INR331.07 apiece.

The CNBC-TV18 television channel reported, citing sources it didn't name, that Vedanta bought an 11% stake in Cairn India from Petronas.

Cairn Energy has extended by more than a month the deadline for the stake sale to Vedanta to May 20 in order to accommodate the completion of the open offer and as an Indian ministerial panel scrutinizes the deal.

Cairn India holds stakes in 10 oil and gas blocks in India, including the huge RJ-ON-90/1 oil block at Barmer in western Rajasthan state. The block's output of 125,000 barrels a day accounts for about 17% of India's total crude production.

Cairn Energy profits boosted by Indian oil field

Cairn Energy profits boosted by Indian oil field

22 March 2011 Last updated at 10:34 GMT

Edinburgh oil firm Cairn Energy has announced profits are up 20-fold since oil started flowing from its field in Rajasthan.

 The company made US$1.1bn (£674m) in pre-tax profits last year, before extensive exceptionals, compared with US$53m (£32m) in 2009.

Production from the Mangala field began in August 2009, and has risen to 125,000 barrels per day.

 Cairn's exploration programme off Greenland will continue this year.

The company is awaiting permission to increase that to up to 240,000 barrels.

A more significant obstacle for the oil company is the need for Indian government approval of a sale of its majority stake in its Cairn India subsidiary.

Chief executive Sir Bill Gammell told BBC Scotland that the company is funded to continue its drilling programme off the coast of Greenland, even if it does not release capital on schedule from the sale of its controlling stake to India-based Vedanta Resources for at least US$6bn (£3.8bn).

He said Cairn Energy has been operating in India for 15 years, and that experience should be a help in unravelling the dispute with the state-owned oil company ONGC.

'Strong relationships'

Sir Bill said: "It's been difficult. I've always taken the view you're a guest in other people's country.

"It's been frustrating for us, there are rules, it's up to the Indian government how to play it.

"We've built strong relationships and partnerships, and in the end of the day, we tend to get the right resolution".

He added that "sanctity of contract" is important in India.

Cairn's main argument has been a government approval to break the previous deal with ONGC would undermine foreign investors confidence in India as having a reliable legal system.

On the 15 April deadline for the deal between Cairn and Vedanta, the chief executive said it was important to get "clarity" before that date.

Cairn's exploration programme off Greenland is scheduled to continue this year, with drill vessels hired for the drilling of four wells as well as seismic surveys.

It began last year, with results described as "encouraging".

Link

http://www.bbc.co.uk/