Cairn India- Corporate Presentation July 2011


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These materials contain forward looking statements regarding Cairn India our corporate plans future financial condit ion, future results of operations, future business plans and strategies. Here we have provided all the facts including Holding Structure, World Class Asset Base, Growth Strategy and Financial Highlights.

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Cairn India- Corporate Presentation July 2011

  1. 1. CAIRN INDIACorporate Presentation July 2011
  2. 2. 2DisclaimerThese materials contain forward-looking statements regarding Cairn India, our corporate plans, future financialcondition, future results of operations, future business plans and strategies. All such forward-lookingstatements are based on our managements assumptions and beliefs in the light of information available tothem at this time. These forward-looking statements are, by their nature, subject to significant risks anduncertainties and actual results, performance and achievements may be materially different from thoseexpressed in such statements. Factors that may cause actual results, performance or achievements to differfrom expectations include, but are not limited to, regulatory changes, future levels of industry product supply,demand and pricing, weather and weather related impacts, wars and acts of terrorism, development and useof technology, acts of competitors and other changes to business conditions. Cairn India undertakes noobligation to revise any such forward-looking statements to reflect any changes in Cairn India’s expectationswith regard thereto or any change in circumstances or events after the date hereof.
  3. 3. 3 Holding Structure IPO December 2006 7.1% 2.6% Listed on BSE & NSE in January 2007 9.4% Part of NIFTY index & DJIT30 52.1% Over 200,000 Indian retail shareholders 28.8% Market Cap >USD13 billion; amongst India’s top 20 Cairn PLC FII Total Equity of 1,902 million shares; Free float ~19%* Vedanta Group Retail InstitutionsDJIT30: Dow Jones India Titans 30 Index, *Free float excludes Vedanta Groups holding As on 27July, 2011
  4. 4. 4World Class Asset Base Production Blocks 10 blocks in the Portfolio Exploration Potential Rajasthan (RJ-ON-90/1) RajasthanCairn (Operator) 70% RJ-ON-90/1 WI 70%ONGC 30% East Coast KG-DWN-98/2 WI 10% KG-ONN-2003/1 WI 49% Cambay (CB/OS-2) PKGM-1 (Ravva) WI 22.5%Cairn (Operator) 40% KG-OSN-2009/3 WI 100%ONGC 50% PR-OSN-2004/1 WI 35%Tata Petrodyne 10% West Coast CB/OS-2 WI 40% Ravva (PKGM-1) KK-DWN-2004/1 WI 40%Cairn (Operator) 22.5% MB-DWN-2009/1 WI 100%ONGC 40%Videocon 25% Sri LankaRavva Oil 12.5% SL 2007-01-001 WI 100% Q1 FY 2011-12: Average Daily Gross operated production at 171,801 boe; Cairn (Working Interest) at 99,640 boe
  5. 5. 5Growth Strategy Maximise Execute Maximise Identify recovery from Rajasthan Potential in new growth production base development Rajasthan opportunities Increased Ravva Mangala current >3,000 km2 in Barmer Frontier exploration reserves by 20% in production-125kbopd; Basin under contract drilling to commence 2010 potential to reach 150 in Sri Lanka kbopd* >16 years of low cost Resource base at 6.5 bn boe Exploration and operations in Ravva Crude transports Appraisal drilling in through Pipeline Initiatives to slow Monetise Barmer Hill KG-ONN-2003/1 down production (BH) & Other Fields; decline – 4D MBA approved peak BH DoC filed, FDP New plays in seismic, Infill drilling production at 175 under preparation kbopd Rajasthan GBA agreement for sharing gas from the Increased recovery Vision to produce 240 through EOR; pilot kbopd** Existing portfolio shared reservoir in ongoing enhancement CB/OS-2GBA: Gas Balancing Agreement, * subject to Joint Venture (JV) and GoI approval, ** subject to JV and GoI approval & additional investments
  6. 6. 6Financial Highlights Q1 FY 2011 - 12 Net Revenue ~USD 830 million EBIDTA ~USD 706 million Profit After Tax (PAT) ~USD 610 million Cash Flow from Operations (CFFO)* ~USD 576 million Quarterly EPS INR 14.3 per share Net Cash** ~USD 1,025 million Gross Cumulative RJ Development Capex** ~USD 3,115 million*CFFO is calculated as profit after tax (excluding other income) prior to non-cash expenses (non-cash employeecost, depreciation, depletion, amortisation, and deferred tax) and exploration costThe company started sharing Profit Petroleum with the GoI in the Rajasthan block at the rate of 20% under theProduction Sharing Contract (PSC) framework** as on 30 June, 2011
  7. 7. 7Financial Highlights Price Realization (USD/boe) Gross Production (Kbopd) Revenue Q1 FY12 104 830 172 Q4 FY11 92 808 161 Q3 FY11 74 691 174 Q2 FY11 68 577 165 Q1 FY11 67 184 95 0 50 100 150 200 0 200 400 600 800 USD Million PAT Cash Flow from Operations Q1 FY12 610 576 Q4 FY11 543 577 Q3 FY11 448 455 Q2 FY11 341 337 Q1 FY11 62 108 0 200 400 600 800 0 200 400 600 800 USD Million USD Million
  8. 8. 8Rajasthan - Frontier to Producing Basin Frontier Exp. Exploration & Appraisal Development & Production 1995 - 2002 Mangala Mangala Processing Terminal Bhagyam Aishwariya Oil Gas Rajasthan Raageshwari Gujarat Viramgam Kandla Koyali  Jamnagar / Salaya Bhogat Tankers to Coastal Refineries25 discoveries to date>3,000 km² approved development area
  9. 9. 9 Rajasthan Update MPT Mangala production ~125,000 bopd; reservoir performance as per expectations 148 Mangala wells drilled; 96 completed, 64 producing Saraswati commenced production in May 2011; currently producing at the rate of 250 bopd Produced and sold >50 mmbbls of crude to Indian refiners; gross Pipeline cumulative field revenue in excess of USD 4 billion to date Total Pipe Diameter Construction activity on Train 4 at MPT commenced; expected to 790 mm (32”) commission in Q4 CY 2011 to take the capacity to 205,000 bopd High Density Polyethylene Wrap Reservoir performance & surface facilities ready to support Mangala production of 150,000 bopd; subject to JV and GoI approval Heat Tube Bhagyam development on track; 33 wells drilled, expected to commence production in Q4 CY 2011; subject to GoI approval Development of Aishwariya underway; plan to commence Poly Urethane production in H2 CY 2012, subject to JV and GoI approval Foam InsulationData as per 26 July, 2011 press release
  10. 10. 10Rajasthan - Crude Marketing Delivery through ~590 km World’s longest continuously heated & insulated heated pipeline Mangala pipeline operational from Barmer to Salaya Sales arrangements in place for 155,000 bopd • With PSU & Private refineries • Discussions continue with GoI for further nominations Radhanpur Crude Pricing • Reference to comparable low sulphur crude - Bonny Kandla Viramgam Light • Price represents a 10-15% discount to Brent on basis Koyali of prices prevailing for 12 months to June 2011 Jamnagar / Salaya Bhogat Completion of Salaya to Bhogat section of pipeline including Bhogat terminal & marine facility scheduled for H2 CY 2012 Tankers to Coastal Refineries • Access to 75% of India’s refining capacity Pipeline Route Existing Pipelines Refinery
  11. 11. 11 Rajasthan - Future Resource And Value Potential ~6.5 Billion boe 250 Gross Gross Initial ~2.5 Billion boe in Reserves, Resources 1 In Place 35+ prospects Most Likely 140 and Potential 2 Risked Volumes Prospective Prospective Resource In Place ~4 Billion boe Gas GIIP BH 308 + Others 20 additional discovered Oil Contingent 1 The independent estimates of Reserves fields including STOIIP In Place MBA and Contingent Resources recently Barmer Hill 707 EOR carried out by D&M are in line with the CIL estimates R & S 12 2 Top 35 prospects audited by D&M A 66 risked resource 178 mmbbls 2.1 Billion boe 78 R & S STOIIP B 293 151 468 M 477 MBA Fields, Raageshwari MBA and Saraswati 1,293 STOIIP FDP approved Risked Prospects, Barmer Hill Leads & Contingent 2P+2C MBA EOR +Other Fields M B A R&S Resource Concepts mmbbls mmbblsData as per 23 March, 2010 press release
  12. 12. 12Rajasthan - Vision For Growth Mangala Processing Terminal Target • Reservoir Performance MBA Technical and • EOR Pilot Implementation Potential FDP Operational • BH Pilots and Development Approved Production • Exploration and Appraisal Production 240,000 bopd Capacity 205,000 bopd • JV Approvals Regulatory • Additional Sales FDP Approved Production 175,000 • Facilities and pipeline bopd • EOR full field implementation Investment • BH staged development • Exploration
  13. 13. 13Exploration Programme Major long term player  Play based approach to building portfolio  Large proprietary database  Diversity of basin, plays and environments  Experienced team  Ongoing regional petroleum system studies  Successful exploration over 10  “Drill Bit exploration”: >190 exploratory years: Success ratio ~50% /appraisal wells RJ-ON-90/1 Assessing new plays, KG-ONN-2003/1 generate new prospects Nagayalanka-1Z discovered; Further Exploration & Appraisal drilling FY 2011-12 MB-DWN-2009/1 Exploration activity I N D I A commenced; 2D seismic in Q1 CY 2012 RAVVA Infill drilling in KK-DWN-2004/1 progress Acquired 300 km2 3D; data processing in KG-DWN-98/2 KG-OSN-2009/3 progress 3D seismic planned 3 appraisal wells drilled by end 2011 OPERATEDNON-OPERATED SL-2007-01-001 PR-OSN-2004/1 Drilling to commence in August Under Force Majeure 2011 – 3 wells SRI LANKA
  14. 14. 14 Exploration - Sri Lanka Block (SL 2007-01-001) Cairn Lanka 100% Working Interest (NOC back- i in 15%) • Block Area: ~3,000 km2 India • Water depth: 400 -1,900m Extension of proven hydrocarbon play (Cauvery / Mannar) Under explored, frontier basin with multiple plays SL-2007-01-001 Exploration Program • 5th generation drillship contracted from Japan Drilling Company • Drilling to commence in August 2011; 3 SRI LANKA wells planned 50km
  15. 15. 15 Rajasthan – Capex & Funding USD billion Capex Gross Net Financed By Exploration (up to 2006)* 0.61 0.57  Net Cash** 1.03 Development  Existing debt facility** 0.68 CY 2007 0.31 0.22 CY 2008 & 2009 1.76 1.23 Total 1.70 CY2010 0.75 0.50 Total Capex up to CY 2010 3.43 2.52 Additional Sources Estimated CY 2011 1.25 0.88  Cash flow from producing blocks i.e. Rajasthan, Ravva and CB Total Actual & Estimated 4.68 3.40*Exploration Cost: During the initial years the entire exploration costs was borne by Cairn India and hence the net number is > 70%.** data as on 30 June, 2011
  16. 16. 16Engaging with the CommunityStrategic Intent Proactive engagement with stakeholders Demonstrate leadership in corporate citizenship Partnering with communities through our principles of respect, relationship and responsibilityAreas of Focus Education Infrastructure Health Economic Development
  17. 17. 17 Summary  Rajasthan • Mangala production at its currently approved plateau of 125,000 bopd • Delivery to domestic refiners through pipeline • Gross field revenue in excess of USD 4 billion • Enhanced oil recovery potential; pilot ongoing • World class resource base – focussed on delivery & growth • Vision to produce 240,000 bopd • Strong economic contribution to the State of Rajasthan and Government of India  Initiatives to slow down the rate of production decline in Ravva and CB  Proven record of fast track, low cost development and production; Field Direct Opex – USD 2.3/bbl*  Success through innovative application of technology  Increasing exploration potential; enhanced resource base through NELP VIII  Sri Lanka frontier exploration drilling campaign to commence in August 2011* For the period FY 2010-11
  18. 18. 18Contact DetailsInvestor Relations Anurag Mantri, Group Financial Controller Email: M: +91 – 98103 01321Media Manu Kapoor, Director – Corporate Affairs & Communications Email: M: +91- 97178 90260Address Cairn India Ltd 4th Floor, Vipul Plaza Sun City, Sector-54 Gurgaon 122 002, India