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Cairn India
Summary of Proposed Investment

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only.

Project number 25474
Sector1Oil and Gas Production (Includes Development)
Environmental categoryB
Date SPI disclosedSeptember 26, 2006
Projected board dateOctober 26, 2006
Previous EventsInvested: April 11, 2007
Signed: April 10, 2007
Approved: April 9, 2007
View Environmental & Social Review Summary (ESRS), click here
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Project description
Cairn India Limited (Cairn India or the company) is a newly incorporated Indian company which has been formed by Cairn Energy PLC (Cairn UK), a crude oil and natural gas exploration and production company trading on the main market of the London Stock Exchange, to acquire those of its subsidiaries which hold all of the ownership and operated interests of its Indian crude oil and natural gas development and production assets and the majority of its Indian crude oil and natural gas exploration assets. The acquisition will be financed by a series of equity financings including a public offering in India and listing on the Bombay Stock Exchange and National Stock Exchange of India Limited. Following the listing, Cairn UK is expected to remain a majority shareholder in the company.

With the support of the central and state governments and regulators and in partnerships with key industry participants such as ONGC, Cairn UK has been exploring, as well as operating development and production assets, in India for over 12 years. Cairn India’s primary asset is a 70% working interest in a development area in Rajasthan, where, in January 2004, Cairn India discovered the Mangala field, the largest onshore crude oil field discovery in India since 1985. In addition, Cairn India’s key assets include operated interests in producing fields at Ravva in Block PKGM-1 (22.5% working interest) in the Krishna-Godavari Basin offshore eastern India and at Lakshmi and Gauri in Block CB/OS-2 (40% working interest) in the Cambay Basin offshore western India. Further, Cairn India has an interest in a number of exploration blocks across India.

The company’s medium term capital expenditure program will focus primarily on Rajasthan and is expected to comprise additional exploratory, appraisal and development drilling as well as the construction of oil and gas processing and export facilities. It will also include a component covering further exploration and development in currently producing fields as well as exploration in non-producing fields.

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