CIL Corporate Presentation - March08

Corporate Presentation - March 2008

CAIRN INDIA

CORPORATE PRESENTATION

March 2008

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08S0245BG24


Disclaimer

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.

Corporate Presentation - March 2008 3

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Cairn in India

DELHI

INDIA

NEPAL

DHAKA

BANGLADESH

KATHMANDU

VISION

India is prospective for hydrocarbons

Rapidly growing energy markets

Favourable investment climate

FOCUS

Sustained investment and re-investment

in the region for more than a decade

Rajasthan – new world-class oil province

established

EDGE

Knowledge / Expertise / Relationships

Consistent strategy and material acreage

position

Partnership with Indian stakeholders


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Track Record of Discoveries

Oil and Gas Found Every Year Since 1998Oil and Gas Found Every Year Since 1998

More than 40 discoveries to dateMore than 40 discoveries to date

Rajasthan - NE, NI-north, NP, Shakti North East, Kameshwari West-2 & -3, Barmer Hill

reservoir in Mangala & Aishwariya. KG Deepwater – W-1, E-1 and ultra-deep water UD-12006

Rajasthan - NI, Vijaya & Vandana, NC-West, GSV-1, Bhagyam South and NR4; KG

Deepwater: U-1, A-1 and D-12005

Rajasthan - Mangala, Aishwariya, Shakti, Bhagyam2004

Rajasthan – Kameshwari, Cambay – CB-X2003

Rajasthan – Guda extension, Raageshwari2002

KG Deepwater discoveries - Annapurna, Padmavati, Kanaka Durga and ‘DWN-N’ &

Rajasthan – Saraswati2001

Cambay discoveries - Lakshmi, Gauri, Ambe2000

Rajasthan - Guda1999

Ravva satellite gas discoveries - RD5, RG & RH1998

Rajasthan – Saraswati Crest-1, Kameshwari West-6; Ravva - RX-10 and RX-82007


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Overview of Assets

RJ-ON-90/1

CB/OS-2

RAVVA

Gross Production62,011 boepd*

Gross Production13,824 boepd*

Gross production target >150,000 bopd

50%ONGC

Cambay (CB/OS-2)

10%Tata

40%Cairn (Operator)

25%Videocon

40%ONGC

Ravva

12.5%Ravva Oil

22.5%Cairn (Operator)

70%Cairn (Operator)

Rajasthan – Exploration (RJ-ON-90/1)

30%ONGC

Rajasthan – Development

100%Cairn (Operator)

14 blocks, 2 producing: Ravvaand CB/OS-2

Operated gross fieldproduction 75,835 boepd(working interest 19,482boepd)

11 offshore platforms and2 processing plants

Rajasthan block underdevelopment

Exploration ongoing in allblocks except CB/OS-2

5 operated

Note : * 9mths 07 figures


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Unique Skill Set

Development

Fast track development

Lakshmi gas fielddiscovery in May 2000and first gas by October2002

Ravva developed froma 3,700 bopd field to35,000 bopd field in 26months (currentproduction ~ 50,000bopd)

Rajasthan fielddevelopment plan(FDP) approved within30 months fromdiscovery

Exploration

More than 40 hydrocarbondiscoveries

Onshore

Offshore

Deep

Shallow

Production

Operates the largestproducing fields in IndianPrivate Sector

Field direct opex of Ravvaand CB/OS-2 is around$1.5/boe

Pioneer in India for use ofthe latest technologies toextend production life

Gas sales contract withpublic and private buyers

Oil sales to four majorrefineries across India

Efficient salesmanagement of morethan $1.6 bn grossannual revenues

Sales

Strong operating track record across all aspects of E&P activitiesStrong operating track record across all aspects of E&P activities


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Key Strategic Initiatives

Intend to executeRajasthan blockdevelopment – Firstproduction Mangala2009

Production fromBhagyam and Shaktifields and theAishwariya field to follow

All of the majorregulatory clearanceshave been obtained

Continue to explore forhydrocarbons in basinsthroughout India

Have identified anumber of leads andprospects in otherblocks in India

Actively pursuingstrategies using state-of-the-art technology tohelp identify potentialleads

Aim to sustain currentproduction volumes atthe Ravva and CB/OS-2(Lakshmi and Gauri)fields

Currently developingthe Lakshmi fieldsseparately for crude oilproduction

Maintain low operatingcost base

Identify newopportunities for

growth in reservesand production

Execute RajasthanExecute Rajasthan

block Northernblock Northern

Fields developmentFields development

Sustain productionSustain production

and maintain lowand maintain low

operating costs inoperating costs in

existing producingexisting producingfieldsfields

Significant resourcebase in the Rajasthanblock

Early application ofEnhanced Oil Recovery(EOR)

Maximise PotentialMaximise Potential

in Rajasthanin Rajasthan

9

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Cairn Group Structure

Cairn IndiaBSE / NSE

90%31%*

69%

*

Cairn Energy PLC

LSENew Investors

CapricornEnergy

Foundation for an Indian oil and gas company

Well positioned to take advantage of Indian growth opportunities

Strong development and operational expertise

Executive and management decision makers based in India

Re-focuses management tocreate value via the "drill bit"

More geared to explorationsuccess

Non-compete agreement with Cairn Energy PLC for three years

3 non-executive directors out of 9 (including Chairman) to be nominees of Cairn Energy PLC

Cairn India

Shareholding:

Retail

3% Institutions

18%

Petronas

10%

Cairn Energy PLC

69%

Note: Shareholding as on 31st Dec 2007

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Current Highlights

First oil production from Mangala on schedule second half of 2009

Rajasthan planned production of more than 150,000 bopd from Northern Fields

Preparation of Mangala FDP addendum underway; will contain a recommendation to increasethe plateau production potential of 125,000 bopd

FDP for Bhagyam is awaiting approval by the GOI on the basis of a planned plateauproduction rate of 40,000 bopd

Aishwariya FDP, approved by GOI; planned plateau production rate of 10,000 bopd

Declaration of Commerciality submitted for 3 discovered fields in Rajasthan NorthernAppraisal Area

Government of India (GoI) ‘Rights of Use’ (RoU) approval for Rajasthan-Gujarat pipeline

State Governments of Rajasthan and Gujarat recommended the competent authorities tocommence the process to secure access to land for pipeline

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RAJASTHANBLOCK RJ-ON-90/1

November 2007

Overview - Rajasthan Block

Gas

Oil

World class oil discoveries in Rajasthan - First Oil second half of 2009

>140 w ells drilled, >24 discoveries to date

4 f ields currently under development Mangala, Aishw ariya, Raageshw ari

and Sarasw ati

Resource base > 3.6 billion boe

Total spend to end December 2007 ~ US$950 million

Planned Production>150,000 bopd

Rajasthan Development Concept

Low Risk Development

Known technology

Shallow depth

Less than 25 wells to firstoil

Rigs under contract

Reservoir Connectivity

Good reservoirconnectivity

High sand content withlimited faulting

Well interference tests

Flow assurance

Hot water injection

Hot water jet pumps

Sustain deliverability

Artificial lift

Fluid Handling capacity

EOR opportunity

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Net (WI) Projected Production

boepd

19,482

~115,000

Gas Oil

9mths 2007 2010First full year of production

93%

7%

63%

37%

Maximise and sustain productionfrom current operational assets

Execute Main Rajasthandevelopments and optimisefurther growth potential throughEOR (2.2 mmbbls in place)

Optimise growth potential in,Barmer Hill, gas and smaller fields(1.4 mmbbls in place)

Future exploration growth acrossall Indian interests

Plateau extension through currentsuccessful infill well drillingprogramme

Strong Production Growth


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Continuing Application of Technology

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

1300

1400

1500

1600

1700

DoC (June 2004) DoC (Aug. 2004)

Update

FDP (Oct. 2005) Dec 2007

MangalaSTOIIP

mmbbls

P50=1071

P50=829

P50=956

P50=1293

IPO Dec 2006

P50=1202

2D

Se

ism

ic, P

HIE

, S

WE

(

2 W

ells

)

Po

st S

TM

3D

Se

ism

ic, P

HIE

, S

WE

( 7

We

lls

)

Pre

ST

M 3

D S

eis

mic

, P

HIE

, S

WT

, D

S D

ata

( 9

We

lls

)

Po

st S

TM

3D

Se

ism

ic, P

HIE

, S

WE

, D

S D

ata

( 7

We

lls

)

Ad

ditio

na

l 2

D S

eis

mic

, P

HIE

, S

WE

(

7 W

ells

)

Dec 2007: Mangala reserves update submitted to DGH

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Enhanced Oil Recovery (EOR) Update

Laboratory Core Flood Experiments completed forMangala and Bhagyam Incremental recoveries:

Polymer Flood: 15% of STOIIPAlkali-Surfactant-Polymer (ASP) Flood:30% of STOIIP

Chemical Flood Simulation studies for Mangalaunderway

Potential for increased off take and plateauextensionReduced water production & injectionSignificant potential for addition of reserves

Techno-EconomicsRobust under wide range of costs & oil price

Forward planClosely spaced ASP pilot during 2009-10

Assess performance under field conditionsStaged field-wide expansion

OIL

SA

TU

RA

TIO

N

I1

I2

I3

I4

I5

I6

I7

P1

P2

P3

P4

P5

P6

P7

P8

ASP Flood

I1

I2

I3

I4

I5

I6

I7

P1

P2

P3

P4

P5

P6

P7

P8

Water Flood

Improvement in Recovery Efficiency

Top Figure: Demonstrates sweep efficiency obtained during scaled sector simulationmodeling for Mangala waterflood and ASP processes.Bottom Figure: Sector modeling results have been upscaled to estimate full-field chemicalflood (Polymer and ASP) recoveries.

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Target First Oil second half of 2009

All approvals in place

(Field Development Plan, Environmental Consent, Consent to Establish etc)

Land acquisition for phases 1 & 2 complete

FEED complete, detailed engineering well underway

Civil works commenced

Contracts awarded for

Road construction

Civil Construction for Mangala

Pumps (various)

Drilling rigs

Main construction contract for upstream

Contracts in process

Power generation package

Control systems

Project Organisation fully in place

Rajasthan Upstream


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Rajasthan: Progress on Evacuation

Alignment on crude pricing

formula between Cairn and

ONGC as sellers

GoI to facilitate pricing withNominees within a controlledprocess and time frame

Negotiation on benchmarkcrude in process

IssuesIssues

MRPL is the GoI nominee

Discussions with MRPL and

other refiners

GoI to appoint multipleNominees to lift remaining Crude

ONGC and Cairn alignment on

moving delivery pointDelivery Point

GoI decision on pipeline costrecovery awaited

Proposed Pipeline route

identified

ROU Granted & Competent

Authority established

PipelineAcquisition of land ROU processinitiated

Pricing

Off-take

Current Status Next Steps


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Mundra

Salaya

Viramgam

Jamnagar

Gujarat

Rajasthan

Mangala

DELHI

Panipat

Mathura

Mangala toSalaya591 km

Mangala toViramgam

325 km

Kandla

Kot

Refinery

Existing Pipelines

Pipeline Route

Koyali

Tankers toCoastal

Refineries

Bhatinda

Rajasthan Midstream: Proposed Pipeline

Refineries Location

Current

Capacity

(MMTPA)

Capacity in

2009-10

(MMTPA)

PSUOn Land 34 52

Coastal 55 60

Private Sector Coastal 41 75

Total 130 187

Proposed pipeline gives access to 75% of IndiaProposed pipeline gives access to 75% of India’’s refinings refining

capacitycapacity


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Rajasthan Midstream: Pipeline

Cairn India responsible for 70% of pipeline costs with JV partner ONGC taking up

remaining 30%

Rights of use (ROU) approved for Rajasthan-Gujarat pipeline

All major contracts awarded for line pipe, engineering procurement contract

and heat management system

Working together with internationally recognized pipeline design engineers JP Kenny

FEED completed

Pipeline opex costs estimated at around US$1/bbl


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Exploration - Highlights

Exploration CapabilitiesExploration Capabilities Exploration: Commitment to Future GrowthExploration: Commitment to Future Growth

Pioneer in India’s exploration industry

3 out of the 7 landmark discoveries were made by Cairn

India from 2000-2005

Lakshmi Gas field in Cambay - 2000

Annapurna Gas field - Deepwater KG Basin – 2001

Mangala Oil Field - Rajasthan – 2004

Success rate of 1 in 3 wells in exploration

Success rate of 39% in Rajasthan

Focus on organic growth through exploration

Maximizing returns on Ravva and Rajasthan through

exploration activities

Cumulative exploration expenditure

2007-2009 = $150m

Plans to drill 13-15 wells per year

Continue to grow and renew exploration portfolio

through licensing rounds; farm-ins and trades

Bids submitted for 2 blocks in Sri Lankan licensing round

Reviewing NELP VII data package

Focus on India – Replace Production – Early Entry – Significant Equity and Acreage

Focus on both mature and frontier/relatively unexplored areas

Operatorship Onshore and Shallow Water – Selective Partnerships with Edge

Maintain balanced portfolio of risk, reward and exposure

EXPLORATIONEXPLORATION

STRATEGYSTRATEGY


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Summary of Recent & ForthcomingExploration Activity

RJ-ONN-2003/1

Drilling expected 2008

GS-OSN-2003/1Entered 2ndExploration period,drilling possible inQ1’09

VN-ONN-2003/12D seismicexpected in2008

RJ-ON-90/1

Further drilling up till 5wells in Q4 2008

GV-ONN-97/1

Ongoing drillingof final spud well

GV-ONN-2003/1

2D seismic in late2008

GV-ONN-2002/1

Drilling in 2008

RAVVA

Appraisal drillingcompleted, extended welltesting ongoing

KG-DWN-98/2UD discovery Q4 2006plus2 exploration wells in2007. Appraisal plan inpreparation; drilling and3D seismic in 2008/09

KG-ONN-2003/1

2D Seismiccommenced in Jan08,3D expected in Q2’08

KK-DWN-2004/1

2D programmeexpected in 2008 PR-OSN-2004/1

2D programmeplanned for Q22008

2008 Exploration Activity: >13 wells, 5 seismic programmes2008 Exploration Activity: >13 wells, 5 seismic programmes

3 wells from early2008

CB-ONN-2002/1

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Ravva

RX-8ZRX-3RX-6

RX-8 Oil and Gas Discovery50m net pay in 4 pay zonesContinued resource growth at Ravvaand significant exploration upsideEastward extension of primary

M30 reservoir and discovery of new deeper Early Miocene pay

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Rajasthan Northern Appraisal Area

Declaration of Commercialitysubmitted for 3 discovered fields

Kameshwari West-2 (oil and gas)Kameshwari West-3 (gas)Kameshwari West-6 (gas)

Northern Appraisal Area completedand 5 wells drilled

Kameshwari West-2Oil DiscoveryColumn height: 27 mNet Pay: 18 m

Kameshwari-6

Kameshwari-West-3

Kameshwari-West-2

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Financial Highlights*

Millions

* Conversion Rate: For Q 1 2007 – Rs.44.1/USD; For Q 2 2007 – Rs.41.3 /USD; For Q3 2007-Rs. 39.85/USD@ Production cost /boe are based on working interest# Includes other income US $ 8.2 m for Q 1, US $ 8.5 m for Q 2 ‘2007 and US $ 8.6m for Q 3’2007

Cash flow operations worked out as PAT prior to non-cash expenses( non –cash employee cost ,DD&A, exploration cost anddeferred tax)

Cash cost includes Production cost, G&A and finance costs.

Financial Summary

Q1 2007 Q2 2007 Q3 2007

Working Interest based boepd 19,811 19,775 18,871

Average Realised Price

Gas per mcf($) 4.07 4.35 4.03

Oil per bbl ($) 61.04 71.11 77.20

Per boe ($) 42.25 50.45 58.38

Production cost/boe ($)@ 6.10 4.60 5.61

$54$54

$41

$3$3

$2

$17

$19

$10

$0

$10

$20

$30

$40

$50

$60

$70

$80

Q 1 2007 Q 2 2007 Q 3 2007

Cash flow from operations Tax Cash cost

$67.5 m #

(revenue)$61.7 m #

(revenue)

$74.1 m #

(revenue)

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First Oil from Mangala on schedule for second half of 2009

Preparation of Mangala FDP addendum underway; will contain a

recommendation to increase the plateau production potential of 125,000 bopd

Government of India (GoI) ‘Rights of Use’ (RoU) approval for Rajasthan-Gujarat

pipeline

State Governments of Rajasthan and Gujarat recommended the competent

authorities to commence the process to secure access to land for pipeline

All major contracts awarded for line pipe, engineering procurement contract and

heat management system

More than five fold production increase by 2010

Ongoing cash flow from current operations in Ravva and Cambay Basin

Established and growing resource base

EOR potential for recovery increase and plateau extension

Summary

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Growth In India

Rising reserves & resources

Increasing production from Rajasthan

Leverage to oil price

Strategic position

Right place ……. right time

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