OilVoice - Cairn Energy Corporate and Operational Update

Cairn Energy Corporate and Operational Update

13 May 2008

Cairn Energy PLC is today issuing its first Interim Management Statement as required by the Disclosure Rules and Transparency Rules of the Financial Services Authority. For the period up to 12 May 2008, Cairn reports the following:

Cairn India

• The Ministry of Petroleum and Natural Gas of the Government of India (GoI), has conveyed its agreement to shift the delivery point with respect to the contract area under the RJ-ON-90/1 Production Sharing Contract in Rajasthan to Salaya at the Gujarat coast.
• Larsen and Toubro Limited (L&T) were awarded the contract for the Engineering Procurement and Construction (EPC) services for the export crude oil insulated pipeline and gas pipeline from Barmer, Rajasthan to Salaya, Gujarat, which is due for completion in 2009.
• Bhagyam Field Development Plan (FDP) approved by Government of India - resource potential to support plateau production of 175,000 barrels of oil per day from Mangala, Bhagyam and Aishwariya (MBA) fields in Rajasthan.
• US$ 625 million preferential allotment of equity to Petronas and Oriental Global Tamarind Fund Pte Ltd. was approved by shareholders at an Extraordinary General Meeting (EGM) and received in April 2008.
• Rick Bott appointed as Executive Director and Chief Operating Officer, effective 15 June 2008. Rick joins Cairn India from Devon Energy’s International division where he was vice president responsible for developing and implementing business growth and exploration strategy.
• Cairn India Q1 results released 29 April 2008.

Capricorn

• Contract for 2D seismic programme in Greenland awarded – work due to commence in H2 2008.
• Evaluation of rig tenders ongoing for exploration drilling in Tunisia in H2 2008.
• Appraisal plans submitted to the Government of Bangladesh (Petrobangla) for the Magnama and Hatia prospects.
• Three joint bids with Santos were submitted for the 3rd Licensing Round offshore Bangladesh.

Production for Q1 2008 (boepd)
Ravva: 6,900
CB/OS-2: 4,595
Sangu: 2,982
Total: 14,477

Average price realised $/boe
Ravva: $84.12
CB/OS-2: $56.50
Sangu: $17.54
Total: $61.85

Group Net Cash

Group net cash at 31st March 2008 was approximately US$ 698 million (including 100% of Cairn India’s net cash balances; US$ 346 million).

The US$ 625 million from the placement of shares in CIL was received in April 2008.