Cairn Energy Receives 18-Month Extension for Rajasthan Block

Cairn Energy has received formal approval from the Government of India for an 18 month extension of the Exploration license for further appraisal over 2,884 km2 of acreage in the north and west of the Rajasthan block.

This Appraisal Area incorporates the Bhagyam and Shakti oil fields as well as several structures requiring appraisal and intervening tracts of untested acreage. One such structure, the N-I structure, has been successfully tested by the N-I-2 well which lies between the Bhagyam and Mangala fields.

The N-I-2 well encountered 21 meters (m) of net pay in high quality Fatehgarh reservoirs. The estimated oil column for the structure is 150 m.

A single cased hole test was conducted and the well flowed at a stabilised rate of 2,300 barrels of oil per day of 24 degrees API oil on a 48/64 inch choke.

Preliminary estimates for the field in-place volumes are between 35 and 70 million barrels.

Discussions with the Government of India are ongoing regarding an application for an extension of the southern area of the Rajasthan block.

Bill Gammell, Chief Executive of Cairn said:

"We are delighted to have secured this extension in Rajasthan which allows us to continue to carry out a comprehensive evaluation prior to agreeing a long term development area. The strong flow rate obtained from the recent N-I discovery continues to demonstrate the potential of this acreage."