The Hindu : Business : Cairn plans IPO of Indian unit

Online edition of India's National Newspaper
Wednesday, Mar 15, 2006

Business

Business

Cairn plans IPO of Indian unit

Issue before oil production commences

NEW DELHI: U.K.-based oil firm Cairn Energy, which discovered India's biggest oil field in Rajasthan, plans to sell at least 25 per cent of its shares in its Indian business through an initial public offer (IPO).

"We intend to examine a partial initial public offering of our Indian exploration and production business on the Bombay Stock Exchange,'' said Bill Gammel, Chief Executive, Cairn Energy. The company estimates in-place reserves in excess of 3.5 billion barrels in the Rajasthan block — the biggest oil find in India in two decades. It upgraded recoverable reserves from Mangala, Bhagyam and Aishwariya — three of the dozen discoveries in the Rajasthan block — by 20 per cent to 606-795 million barrels.

The IPO, he said, might happen before oil production commences in Rajasthan fields in 2008.

Meanwhile, Cairn Energy's Chairman Norman Murray told reporters in London that the success the company had found in India over the last two years had changed the nature of the company and the time had come to look at ways of increasing the autonomy of the Indian business while realising value for shareholders.

"The substantial part of any cash proceeds would be returned to shareholders. The production company would be created just as it was about to become enormously cash generative", adding that the residual Cairn would continue as an exploration focused company. — PTI

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