Cairn Makes Fourth Discovery in Northern Rajasthan

Cairn announces a fourth significant oil discovery in northern Rajasthan with the N-V-1 exploration well on block RJ-ON-90/1 which is located 18 kilometers west-north-west of the Mangala field, 19 kilometers west-south-west of the N-C discovery, and in close proximity to the existing north-western boundary of the block.

The N-V-1 well, which is currently operating at a depth of 812 meters, enountered an oil column of 62 meters with an estimated 35 meters of net oil pay in excellent quality Fatehgarh sands. The well was drilled 90 meters down-dip from the currently mapped crest of the structure. The top Fatehgarh was encountered at 590 meters and an oil water contact was established in the well.

An open hole test programme has been carried out across one 10 meter interval just above the oil water contact. The well flowed for around six hours and produced oil to surface with a specific gravity of approximately 21 degrees API. Oil flow rates were limited due to the oil density and viscosity combined with the shallow depth and low pressure of the reservoir. As a result, a cased hole test on pump will be required to determine the true formation productivity.

The mean oil initially in place as currently mapped is estimated to be approximately 300 million barrels. However, the full extent of the structure is unconstrained due to the paucity of seismic data off the block to the north.

As was the case with the N-C discovery, agreement with the Indian Government will be required for a second extension area beyond the current north-western block boundary before further appraisal.

Further details of Cairn's ongoing drilling program in Rajasthan will be provided at the time of the interim results announcement on Tuesday September 7th.

Bill Gammell, Chief Executive, commented:

"This is the fourth significant oil discovery Cairn has made in the northern portion of the Rajasthan block this year. This further demonstration of the widespread distribution of high quality reservoir sands bodes well for future exploration and appraisal success."