Cairn India - Corporate Presentation - September 2013

© 2013 Cairn India Limited

Corporate Presentation September 2013

2 Corporate Presentation

This material contains forward-looking statements regarding Cairn India and its affiliates, its corporate plans, future financial condition, future results of operations, future business plans and strategies. All such forward- looking statements are based on the management's assumptions and beliefs in the light of information available to them at this time. These forward-looking statements are by their nature subject to significant risks and uncertainties; and actual results, performance and achievements may be materially different from those expressed in such statements. Factors that may cause actual results, performance or achievements to differ from 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 use of technology, acts of competitors and other changes to business conditions. Cairn India undertakes no obligation to revise any such forward-looking statements to reflect any changes in Cairn India's expectations with regard thereto or any change in circumstances or events after the date hereof. Unless otherwise stated the reserves and resource numbers within this document represent the views of Cairn India and do not represent the views of any other party, including the Government of India, the Directorate General of Hydrocarbons or any of Cairn India’s joint venture partner.

All data points in the presentation refer to status as on 31 March, 2013, unless otherwise specified.

Disclaimer


Where are we today

A top 20 global

independent E&P

company;

Market Cap - US$10bn Robust financial

position

Operational excellence

and Strong skill set

World class resource

Base

Active Exploration

Program for Growth


Asset Locations & Share of Production

• Balanced Asset Portfolio, Net acreage in excess of 42000 sqkms, ~ size of Switzerland

• Successful track record across Exploration, Development and Production cycle

Note: Percentages represent Working Interest

PR-OSN-2004/1

35%

KG-ONN-2003/1

49%

KG-OSN-2009/3

100%

CB/OS-2

40%

RJ-ON-90/1

70%

RAVVA

22.5%

SOUTH

AFRICA BLOCK 1

60%

SL-2007-01-001

100%

MB-DWN-2009/1

100%

Name of Asset

Participating Interest (%)

INDIA

Asset Basin Exploration Development Production

Domestic Assets

RJ-ON-90/1 Barmer

CB/OS-2 Cambay

KG-ONN-2003/1 KG Onshore

KG-OSN-2009/3 KG Offshore

Ravva KG Offshore

MB-DWN-2009/1 Mumbai Offshore

PR-OSN-2004/1 Palar – Pennar

International Assets

SL-2007-01-001 Mannar

Block 1 Orange

Assets across the life-cycle of a field

World Class Resource Base


Volume Growth

• Rich Resource base supports production growth

• Currently account for over 25% of India’s oil production*

• Strong Partnerships with state and private companies

* Source: Ministry of Petroleum and Natural Gas, Government of India

Sustained Year on Year Growth

95%

5%

Oil Gas

Total Production of 212,442 boepd in Q1’FY14

FY10 FY11 FY12 FY13 FY14 Exit*

69

CAGR: 31%

Cairn India’s Production Growth (kboepd)

149 173

205

>225

Product Mix


Robust Financial Performance

0.3 0.3

2.3 2.5

3.2

FY09 FY10 FY11 FY12 FY13

Re

ve

nu

e (

US

$ b

n)

CAGR

55%

0.2 0.2

1.8 1.9

2.4


CAGR

66%

EB

ITD

A (

US

$ b

n)

0.2 0.2

1.4 1.7

2.2


CAGR

61%

PA

T (

US

$ b

n)

0.2 0.2

1.4 1.5

2.0


Ca

sh

Flo

w

fro

m O

pe

ratio

ns

(US

$ b

n)

CAGR

58%

FY09 values are for 15 month ended Mar’09

• Strong revenues and profits driven by lowest quartile F&D and operation costs

• Flexibility to develop asset base and support accelerated growth


Operational Excellence across the value chain

• Safety First - LTI free man hours of 65 million across assets as on

30 June13

• Opened 4 frontier basins with >40 discoveries

• Excellence in Execution - Discovery to Production

• Onshore Oil production - in 5 years in Rajasthan

• Offshore natural gas production - In 28 months in Cambay

• Leveraging technology to reduce total cost of ownership

• Skin effect heating system – world’s longest continuously

heated pipeline

• Modular well pad concept – rapid moving rigs

• Uptime greater than 98% with field direct opex at $3/bbl


Efficiently manage onshore and offshore projects

Strong Infrastructure in place

Ravva: Production Trends Cambay (CB/OS-2):

Gas Producing to Oil Producing

0

5000

10000

15000

20000

25000

2002-03 2005-06 2008-09 2011-12

Gas BOE (boepd) Oil Production (bopd)

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

1995-961999-002003-042007-082011-12

Rajasthan: Production Trends

0

50000

100000

150000

200000

2009-10 2010-11 2011-12 2012-13


To invest $3 billion net over 3 years

To prove up reserves through exploration

To increase production primarily in Rajasthan

Block (RJ)

~20%

~15%

~25%

~40%

RJ Additional

Production

(BH +

Satellite

fields)

RJ

Exploration

RJ Production

Sustenance (MBA + EOR

+ Infill drilling)

Other

Assets

≈80% of the

capex planned

for RJ

Exploration (45%)

Development (55%)

Note: *Capex excludes spend on new ventures &

development of new exploration discoveries in RJ

TOTAL

Gross in Place Gross

EUR

7,297 1,764

Significant Potential In Barmer Basin

Currently Under

Development/

Production

Future

Development &

Prospective

Resources

2,272

1,069 (~47%)

Gross In

Place

1,925

165 (~9%)

Gross In

Place

3,100

530 (~17%)

Gross

EUR

Gross

EUR

Exploration BH + 19

Disc.

MBARS

Note: Percentages represent recovery factors

Active Capex Program for Growth

(Mmboe)


Polymer Flood - Improved Sweep Efficiency

Alkaline Surfactant Polymer Flood- Improved Displacement Efficiency

Areal Sweep improvement Vertical Sweep improvement

Original Oil

Initial After Waterflood After ASP flood

Sand Grain Remaining oil Water

Improving Ultimate Recovery (EOR + Infill drilling): ≈$1,200Mn

• To sustain the MBA plateau via EOR technology and infill drilling

Oil Saturation Display at Pore Level -

Reduction in Trapped Oil

Enhanced Oil Recovery Pilot Performance


Additional Producing Fields (BH + Satellite): ≈$450Mn capex

Monetizing ≈ 2bn boe contingent resource base

• Barmer Hill formation spread over a large area in the basin

• Oil and Gas found in majority of the wells penetrating

BH formation

• Low permeability tight reservoirs

• Infrastructure is already in place for quick

monetization

• Require fracture stimulation and horizontal wells to

optimize recovery

• Data Analogs indicate recovery factors of 7 to 20%

• Development plan for BH submitted

• Production expected to commence in FY14, subject

to approvals


Exploration in Rajasthan (RJ) - ~US$ 750m

To pursue high-value exploration opportunities

A Target-Rich Environment

~100 Prospects; 20 Play Types

Prospective Resources: 530 mm boe Gross Risked Recoverable

(3.1 bn boe in place)

Two-pronged Strategy

Proven Play Extensions

• Drill prospects with largest risked volumes first

• Revise / re-prioritise remaining prospects based on results

Unproven Plays

• De-risk the play – Drill lowest risk prospect first

• Revise / re-prioritise tested play based on results

Exploration Program

Plan to drill ~100 E&A wells; rig count to increase multifold

Acquire ~1,900 sq km of additional 3D seismic to assist in extending

proven plays & de-risking prospects


Major Undrilled Play Types in RJ


Ensuring growth in other assets - $ 600Mn

Portfolio Diversity Across India

Raava: ‘High Value/ High Risk’ prospect to be drilled in

H2 FY13-14

KG-ONN-2003/1: Drilling underway to appraise the

second discovery with 2nd well planned in FY14

KG-OSN-2009/3: Conditional approval to carry out

petroleum operations in 65% of block

MB-DWN-2009/1: Conditional approval to carry out

exploration activity received

PR-OSN-2004/1: Significant progress towards

resumption of exploration activity

Growing International Exposure

Successful exploration in Sri Lanka – two gas discoveries;

commercial options under review

3D seismic gathered in S. Africa Block 1; processing

underway; plan to drill exploration well in 2015

A growth-focused New Ventures strategy aimed at

capturing best-fit international opportunities

SOUTH

AFRICA

ORANGE

INDIA

RAJASTHAN

MUMBAI

RAAVA

KG – ON/OFFSHORE

PALAR/

PENNAR

MANNAR

BASINS

(Established & Emerging)

KG: Krishna Godavari

MB: Mumbai Basin

PR: Palar Basin


Summary

Exploration

Success

Market Cap End of Period

US$ 0.5bn

US$ 6.0bn US$ 10bn

Reserves & Resources End of Period 1.17 bn boe 1.29 bn boe

Target Additional 530 mmboe from RJ exploration

Ravva Re-development

Rajasthan & CB/OS-2 discoveries

FY1999 FY2000 - 2006 FY2014 - 16

• Delivered on the investments made in the past with high returns

• High level approval for exploration in Rajasthan to help future delivery

FY2007-2013

Restart RJ

Exploration

Policy clarification on exploration

$3Bn Capex plans for future growth


Value

Proposition

As India’s largest private sector E&P company

accounting for 25% of the country’s energy production,

Cairn India is well positioned to grow revenues and

profits. Its strong track record, low cost of operations,

high cash flow generation, combined with the world's

growing demand for energy, provides confidence for

future growth in reserves and production while meeting

its return on capital targets.

Top

Mgmt

Chairman: Navin Agarwal

CEO: P. Elango

CFO: Sudhir Mathur

FY13

Production

Gross Production: 205,323 bopd

Oil: 195,780 bopd

Gas: 57 mmscfd

Countries India

Sri Lanka

South Africa

Producing

Assets

Rajasthan (RJ-ON-90/1)

Andhra Pradesh - Ravva (PKGM-1)

Gujarat - Cambay (CB/OS-2)

Reserve Base Gross 2P Hydrocarbons Initially in Place (mmboe): 5,641

Gross 2P Reserves & Resources (mmboe): 1,386

Net Working Interest 2P Reserves & Resources (mmboe): 871

Capital

Budget

$3 billion over three years (FY2014, 2015, 2016)

55% for Production; 45% in Exploration

Capital

Allocation

~15% additional production (BH and satellite fields)

~40% RJ production and sustenance (MBA+EOR+Infill Drilling)

~25% RJ exploration

~20% other assets (e.g. KG, Ravva, Sri Lanka, South Africa)

Achievements Together with its JV partners accounts for ~25 per cent of India’s crude oil production

Among the top 20 global independent E&P companies

Built world’s longest (~600 kms) continuously heated and insulated pipeline

Awards

Fastest growing energy company in the world at Platts Top 250 Energy Company

Awards 2012

16 awards in 26th Mines Safety week 2012 under aegis of Directorate General of

Mines Safety (DGMS), Ajmer

Golden Peacock Award for Excellence in Corporate Governance, 2012

Financial

Strength

FY 2013

P&L

Revenues: US$3.2 billion

PAT: US$2.1 billion

EPS: INR 63.2

Cash Flow from Operations: US$2 billion

Balance Sheet

Cash: US$3.1 billion

Assets: US$9.9 billion

Zero Debt Company

Other Ratios

Dividend Yield: 4%

DPS: INR 11.5

BVPS: INR 250

Stock

Market

Market Cap: ~$10 billion

Listed on: NSE, BSE

Index Representation - Nifty 50 and MSCI

Symbols: CAIRN (NSE); 532792 (BSE);

INE910H01017 (ISIN); CAIR (Bloomberg)

Shares outstanding: 1910 million

Shareholding Pattern:

Vedanta Group: 59%

Cairn PLC: 10%

Institutional Holding: 28%

Retail: 3%

Contact Information

Nidhi Aggarwal

M: 91 – 98101 97755

[email protected]

[email protected]

Cairn India Ltd.

4th Floor, Vipul Plaza, Sun City, Sector-54,

Gurgaon 122002

India

Fact Sheet

mailto:[email protected]

mailto:[email protected]


Q&A


Q1 FY 2013-14

Factsheet

Summary - Q1’14 Financials

• Average Price Realization:

• CIL - US$ 93.3 / boe

• RJ Oil - US$ 94.3 / bbl

• RJ Oil Price Discount:

8%

• RJ Opex: US$ 3 / boe

• Net Cash: US$ 3.16 Bn

Unit Q1 FY 2013-14 Q4 FY 2012-13 q-on-q%

Gross Production Boepd 212,442 202,014 5

Revenue INR bn 40.6 43.6 -7

EBITDA INR bn 29.1 28.9 1

EBITDA Margin % 71.6% 66.3% 530bps

DD&A INR bn 5.2 4.7 9

EBIT INR bn 32 26.4 21

PBT INR bn 31.9 26.2 22

PAT INR bn 31.3 25.6 22

EPS INR/sh 16.4 13.4 22

Cash EPS INR/sh 12.9 13.2 -2

CFFO INR bn 24.4 26.7 -8

Profit petroleum pay-out to the government rose from 20% to 30% in the Development Area 1 (DA1) in the RJ block


Asset US$ bn Liability US$ bn

Current Assets Current Liabilities

Cash and Investments 2.9 Current Liabilities 0.6

Other Current Asset 0.7 Non Current Liabilities

Non Current Assets Non Current Liabilities 0.5

Fixed Asset 2.5 Shareholders Funds

Goodwill 2.8 Networth 8.8

MAT Credit 0.9

Other LT asset 0.1

Total 9.9 Total 9.9

Strong Stable Balance Sheet

2.5 3.1 1.4

16.4

25.3


ROE (%)

1.3 1.7

16.7 15.3

22.1


ROCE (%)

US$ INR: 54.39

Business

Cairn India - Corporate Presentation - September 2013