Significant Oil Discovery in Rajasthan

19 January, 2004

N-B-1 Exploration Well, Block RJ-ON-90/1

The N-B-1 exploration well, which is currently operating in the onshore northern Rajasthan Basin, has made a significant oil discovery in a large simple structure at shallow depths.

The well, located 60 kilometres north of Saraswati, is presently at a depth of 1,250 metres and has not yet reached the planned total depth. An intermediate log has been run and evaluated and fluid samples of 24 degree API oil have been recovered from the Fatehgarh.

The well has encountered two separate reservoir sections:-

Barmer Hill Reservoir
The well has intersected a log evaluated gross oil column of 136 metres in silty sands from the Barmer Hill formation. The net pay is estimated to be 22 metres with an average porosity of 21%.

Fatehgarh Reservoir
The well has intersected a log evaluated gross column of 185 metres in excellent high quality Fatehgarh sands. The net pay is estimated to be 85 metres with an average porosity of 25%. An oil-water contact has been established in the Fatehgarh.

Planned Testing
Once the well has reached total depth a test programme is planned to confirm reservoir deliverability, after which further announcements will be made.

Initial Oil in Place and Reserve Estimates
The initial estimates for the oil in place of this discovery range from 450 to 1,100 million barrels. Preliminary reserve estimates are in the 50 to 200 million barrel range.

Forward Appraisal and Exploration Programme
The current drilling programme is now being reviewed to allow early appraisal drilling of the N-B-1 discovery and continued exploration drilling of several similar prospects in the vicinity.

Bill Gammell, Chief Executive, commented:

“Whilst further evaluation and appraisal is required I am confident that this discovery in isolation has the potential to transform the value of Cairn’s portfolio.”

Enquiries to:

Cairn Energy PLC

Bill Gammell, Chief Executive Tel: 0131 475 3000
Mike Watts, Exploration Director Tel: 0131 475 3000
Kevin Hart, Finance Director Tel: 0131 475 3000

Brunswick Group Limited:

Patrick Handley, Catherine Bertwistle, Mark Antelme Tel: 0207 404 5959

Notes to Editors:

  1. “Cairn” where referred to in this release means Cairn Energy PLC and/or its subsidiaries, as appropriate.
  2. Cairn is currently involved in an extensive exploration and appraisal programme across its 5,000 square kilometre onshore exploration block (RJ-ON-90/1) in the Rajasthan Basin.
  3. Cairn holds a 100% interest in Block RJ-ON-90/1. Oil & Natural Gas Corporation Ltd (“ONGC”) has a right to 30% of any development area resulting from a commercial discovery on the block.
  4. The main exploration play objectives encountered in the Rajasthan Basin, commencing with the stratigraphically youngest formation, are: Thumbli, Dharvi Dungar, Barmer Hill and Fatehgarh.
  5.  “API” where referred to in this release means American Petroleum Institute units as a measure of oil specific gravity.