Cairn’s oil search in Lanka progresses with success

Cairn India’s search for oil in Sri Lanka is progressing with considerable success the Company revealed on Friday.

“The potential commercial interest notification has been submitted for the Dorado Discovery,” Rahul Dhir, Managing Director and Chief Executive Officer, Cairn India said as per the terms of the Petroleum Resource Agreement (PRA) with Sri Lankan Government.

This is following successful completion of the first phase of the exploration campaign in Sri Lanka Block SL-2007-01-001. The exploration program involved the acquisition, processing and interpretation of 1,753 sq km of 3D seismic data and a three well deep water drilling program. This program resulted in two successive gas and condensate discoveries: the CLPL Dorado- 91H/1z well and, the CLPL-Barracuda- 1G/1 well. The third well, CLPL-Dorado North 1- 82K/1 was plugged and abandoned as a dry hole on 14 December, 2011.

“Cairn Lanka’s successful drilling program – the first in Sri Lanka in 30 years – has established a working petroleum system in the frontier Mannar Basin. Following this success, Cairn Lanka has entered the second phase of exploration with the approval of the Government of Sri Lanka. Additional 600 km2 3D seismic data has been being acquired which will firm up several promising leads and prepare the Operator for further exploration drilling in mid CY 2013. The potential commercial interest notification has been submitted for the Dorado Discovery, as per the terms of the Petroleum Resource Agreement (PRA),” the Company said in a note accompanying consolidated financial results for the year ended on 31 March 2012.

It also said that additional acquisition of 3D seismic data has been completed and tendering was in process for contracting a drill ship and services.

Commenting on its overall operations in India, Cairn said it continues to add value and to contribute to India’s energy security.

“Last year, we have reduced oil imports by US$ 6 billion and have contributed US$ 2.4 billion to the national exchequer,” Dhir said.

“The ONGC-Cairn Joint Venture has reached a major milestone of achieving 175,000 barrels of oil per day production from Rajasthan today,” he said adding that “Positive results of the EOR pilot, re-evaluation of the exploration potential in Rajasthan along with the discovered resource support a basin production potential of 300,000 bopd.

Cairn India’s revenue in Q4 FY 2011-12 was $ 727 million whilst for the FY 2011-12 it was $ 2.48 billion (up 15%) Profit after Tax (PAT) in Q4 FY 2011-12 was $ 435 million and FY 2011-12 it amounted to $ 1.6 billion, up by 25% over the previous year.