2015 Half Yearly Results Presentation

8/19/2019 2015 Half Yearly Results Presentation

1/24

Deliveringvaluefrom

discoveryanddevelopment

Half-Yearly

Results Presentation

August 2015


2/24

Disclaimer

Thesematerialscontainforward-lookingstatements

regardingCairn,ourcorporateplans,futurefinancial

condition,futureresultsofoperations,futurebusinessplans

andstrategies.Allsuchforward-lookingstatementsarebasedonourmanagement'sassumptionsandbeliefsinthelightof

informationavailabletothematthistime.

Theseforward-lookingstatementsare,bytheirnature,subject

tosignificantrisksanduncertaintiesandactualresults,

performanceandachievementsmaybemateriallydifferent

fromthoseexpressedinsuchstatements.Factorsthatmay

causeactualresults,performanceorachievementstodiffer

fromexpectationsinclude,butarenotlimitedto,regulatory

changes,futurelevelsofindustryproductsupply,demandandpricing,weatherandweatherrelatedimpacts,warsandacts

ofterrorism,developmentanduseoftechnology,actsof

competitorsandotherchangestobusinessconditions.

Cairnundertakesnoobligationtoreviseanysuchforward-

lookingstatementstoreflectanychangesinCairn's

expectationswithregardtheretooranychangein

circumstancesoreventsafterthedatehereof.

Cairnmakesnorepresentationsorwarranties,eitherexpressorimplied,astotheaccuracy,completenessorqualityofthe

datacontainedinthispresentation;andCairn,itsDirectors,

officers,employees,agents,consultantsandadvisersshall

bearnoliabilitywhatsoeverwithrespecttotheuseofor

relianceonthedatabyanythirdparty.


3/24

Deliveringvaluefromdiscoveryanddevelopment


Simon ThomsonChief Executive


4/24


4

Strategy

Half-Yearly Results Presentation, August 2015

Mature basin exploration and development Frontier and emerging basin exploration with primary focus

on Senegal

Balanced

Business Model

Core development assets through to free cash flowFully Funded

World class new basin play

JV agreement on the sequence, location and evaluationtargets for three firm appraisal and exploration wells

Targets identified for drilling commencing Q4 2015 Government of Senegal agreement for an extensive

evaluation plan to access full block potential of gross meanrisked resource of > 1 bn bbls*

SenegalValue

* Cairn estimates


5/24DeliveringvaluefromdiscoveryanddevelopmentDeliveringvaluefromdiscoveryanddevelopment

James SmithChief Financial Officer


6/24Deliveringvaluefromdiscoveryanddevelopment

Group cash at 30 June 2015 of US$725m

Seven year Reserve Based Lending bank facility up to US$575m remains undrawn

Forecast exploration and appraisal expenditure for the committed forward programmeof US$170m (predominantly Senegal drilling activity during H2 2015 and H1 2016)

Forecast net development capex on Catcher and Kraken of US$615m from H2 2015 toexpected free cash flow by year end 2017

Resolution of the Indian tax dispute remains a key priority, but the business plan isfunded and deliverable from existing financial resources

Half-Yearly Results Presentation, August 2015 6

Group Funding

* Net of Norwegian Tax Refunds



West Africa includes firm costs for 3Dseismic and a 3 well programme in Senegal

$55m received in January 2015 oncompletion of Catcher farm down to Dyas

Kraken contingent carry to be determinedduring 2015, currently estimated at ~$50m

Capital Expenditure


Committed Explorationand Appraisal Programme $170m

H2 2015 – YE 2017 Catcher and KrakenDevelopment Capex $615m

Catcher

Kraken

$180m

$435m

UK &

Norway*

West Africa

$30m

$130m

Other

$10m

* Net of Norwegian Tax Refunds



Fully funded to deliver our exploration, appraisal and development programme

Debt facility remains undrawn and available

Low oil price break even economics across the portfolio

North Sea development projects remain on track and on budget to deliver free

cash flow from 2017 onwards

Senegal programme targets material upside potential, deliverable in a lower oilprice environment

Continued focus on disciplined capital allocation to deliver strong economicreturns through the cycle


Finance Summary


9/24DeliveringvaluefromdiscoveryanddevelopmentDeliveringvaluefromdiscoveryanddevelopment

Richard HeatonExploration Director



Government of Senegal agreement for an extensiveevaluation plan submitted by Joint Venture (JV) Q22015

Appraisal and exploration drilling - 3 firm wells withpotentially 3 further wells

Coring and testing of appraisal wells

3D seismic acquisition programme to commenceQ3 2015

Will cover 2,600km2 over the Sangomar block and southwest of the Rufisque block

Cairn has identified more than 5 prospects and 15 leads

Objective to develop additional prospects to a drill readystatus within 2016

Ocean Rig Athena, 7th Generation dual activitydrillship, selected for drilling programme


2015 Programme

Senegal

Proposed 3D Full FoldSeismic Survey

Seismic

Potential Well

Firm Well

Cairn Licences

3D Seismic – Cairn Owned

FAN-1Discovery Well

Total Acreage

~7,490km2

SNE-1

Discovery Well



30km radius

Full block potential of gross mean risked resourceof > 1 bn bbls*

SNE 2C resource, currently ~330 mmbbls

SNE Initial projected production 50,000 – 100,000 bopd

Sum of gross mean risked prospect resources ~380mmbbls

Sum of gross mean risked lead resources ~350mmbbls

Hub development will optimise value in blocks

Shelf exploration prospectivity Significantly de-risked by SNE discovery

3D seismic cover required for shelf prospects extending intoSangomar and Rufisque

Ongoing FAN-1 and SNE-1 well analysis and seismicreprocessing

Confirming potential of SNE discovery

Characterise SNE and FAN reservoirs (including thin beds)

Updating exploration portfolio and ranking

11

Senegal

Full Block Potential


* Cairn estimates



SNE-1 Appraisal Objectives

Coring and testing of the reservoir: Determine reservoir continuity and connectivity

Establish productivity of the reservoirs

Populate static and dynamic models

Determine commerciality and underpinexploitation plan

Reduce uncertainty range

Increase 1C resource

Confirm and potentially increase 2C resource

Evaluate further oil potential

Continue shelf area exploration

12

Senegal

SNE Field Forward Programme 2015 / 2016


3D Seismic

~25km

SNE-1FAN-1

M a r t i n e t a l 2 0 1 0


13/24


First appraisal well SNE-2, is in theSangomar Deep Offshore block, 3km

north of the SNE-1 discovery

SNE-2 is a Crestal well in a centrallocation in the heart of the fieldwhere it can be expected toencounter maximum hydrocarbon

density

SNE-2 will spud Q4 2015 and willinclude coring and testing, taking sixweeks to drill and core and furtherfour weeks to test

13

Senegal

SNE 2 Appraisal Target at the SNE Field


SNE Current Gross resource range recoverable (mmbbls) 1C 150 2C 330 3C 670

SNE-1

Discovery Well

SNE-2

Central Appraisal

indicative location

Km

10 2

Km

10 2

AppraisalIndicative

Locations


14/24


The second appraisal well SNE-3, onSouthern Flank expected to begin late

Q4 2015 / early Q1 2016

Well will test the southern extent ofthe field and will help to dictate theshape of the structure and define theaerial extension to the south

This is a key well to establishdeliverability and the full potentialof the field

SNE-3 will include both coring and

testing, taking six weeks to drill andcore and further four weeks to test

14

Senegal

SNE 3 Appraisal Target to South of the SNE Field



SNE-1

Discovery Well

SNE-3

Southern Appraisalindicative location

Km

10 2

Km

10 2

AppraisalIndicative

Locations


15/24


15

Senegal

BEL 1 Appraisal Target to North of the SNE Field



Km

10 2

Km

10 2

AppraisalIndicative

Locations

SNE-1

Discovery Well

BEL-1

Northern Appraisal

indicative location

The third appraisal well BEL-1, is onthe Northern Flank and is expected

to begin Q1 2016

This well has a significant Explorationtarget (Cenomanian “Buried Hillplay”)

This well will also test the northernextent of the field and will help todictate the shape of the structureand define the aerial extension to thenorth

This is also a key well to establishdeliverability and the full potential ofthe field

Gauges will likely be run in this wellto allow future intra-field testing

H lf Y l R lt P t ti A t 2015 16


16/24


RUFISQUE LEAD 1

RUFISQUE LEAD 2

SOUTH FAN

PROSPECT

CENTRAL

FAN

PROSPECT

SOLEIL

PROSPECT

SPICA

LEAD

ELECTRA LEAD

SIRIUS

PROSPECT

FAN FIELD

ACHERNAR LEAD

RUFISQUE LEAD 3

FAN-1

Discovery

SNE-1

Discovery

BEL-1

Prospect

Confirmation of source rock and burial

history from new data Remapping key reservoir and source

intervals

Redefining basin model

Redefining plays, creating new prospect and

lead inventory Acquisition of additional 3D seismic data

BEL-1 is an Exploration well with a low riskexploration target on the Bellatrix Prospectwhich will also evaluate the Northern Flank

of the SNE Field Confirming viability of additional plays

More than 5 prospects and 15 leadsidentified


Senegal

Future Exploration Programme

Half Yearly Results Presentation August 2015 17


17/24


BEL-1 exploration and appraisal well

Bellatrix Prospect lies above thenorthern flank of SNE discovery

Will test the Bellatrix prospect andevaluate the Northern Flank of the field

Will target both probable Cenomanian

and Albian prospective reservoirs Will be cored and likely left such that

testing is possible in the future


Senegal

Bellatrix Prospect

Cairn Current Gross

unrisked resource range recoverable (mmbbls)

P90 35 mean 157 P10 333

Bellatrix Prospect

A A’

N S

SNE Field

Bellatrix Prospect

BEL-1 Loc.

Half Yearly Results Presentation August 2015 18


18/24


Evaluation programme aims to confirm volumes, connectivity and productivity

Preliminary foundation development concept for SNE Standalone FPSO (Floating Production Storage and Offtake vessel) with expansion

capability for satellite tie-backs

Subsea production, gas injection and water injection wells

Initial SNE plateau oil rate expected 50,000 - 100,000 bopd

Threshold economic field size (gross) >=200 mmbbls for foundation development project

First oil anticipated 2021-2023


Development

From Discovery to Development

First Oil

Evaluation

Plan

Exploitation

Plan FID

Discovery AppraisalConcept

SelectFEED

DetailedDesign andFabrication

Production

2014 2-4 yrs 3-5 yrs

Half-Yearly Results Presentation August 2015 19


19/24


The Catcher project remains within budget and onschedule for first oil 2017

Subsea installation work has commenced with twotemplates already installed and gas export pipelinesuccessfully laid

The Ensco rig is now on hire and batch drilling of

the first four development wells has commenced

Fabrication of the FPSO hull and topsides isongoing

Half Yearly Results Presentation, August 2015 19

UK and Norway

Catcher

Development

Premier (Operator) 50%, Cairn 20%, MOL 20% and Dyas 10%Gas export PLEM Installation

Gas export pipeline spooling onto Seven Navica



20/24


The Kraken project remains within budget and onschedule for first oil 2017

The fixed pipelines for the first two drill centres havebeen installed on the seabed. Installation of themooring system of the FPSO also started H1 2015

Kraken FPSO vessel is at the shipyard in Singapore and

the conversion programme is continuing on plan.Equipment procurement and fabrication of themodules is in progress

Batch drilling of the top-holes at the first drill centrehas been completed, the drilling rig is progressingwith the pre-drilling of individual wells

Half Yearly Results Presentation, August 2015 20

UK and Norway

Kraken

Development

Subsea:

Aker and

Technip

Transocean

Leader

EnQuest (Operator) 60%, Cairn 25% and First Oil 15%


http://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRw&url=http://www.skipsfarts-forum.net/read.php?TID=1082&page=18&ei=SJoJVdPQLtTdap7IgagP&bvm=bv.88198703,d.ZGU&psig=AFQjCNFNlNA_5k71J08Cble9iJ4xxQCI4Q&ust=1426779063008579http://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&uact=8&ved=0CAcQjRw&url=http://www.skipsfarts-forum.net/read.php?TID=1082&page=18&ei=SJoJVdPQLtTdap7IgagP&bvm=bv.88198703,d.ZGU&psig=AFQjCNFNlNA_5k71J08Cble9iJ4xxQCI4Q&ust=1426779063008579


21/24


Norway

Skarfjell (20% Cairn) early stage developmentplanning

Norwegian 2014 Licensing Round: Awardedfive licences Q1 2015

Norwegian 2015 APA licence round

applications being evaluated Process to pre-qualify as Operator in Norway

well advanced

Pursuing recent entry into Barents Sea withpossible applications in 23rd Licence RoundQ4 2015

y , g

UK and Norway

Developments and Exploration in Mature and Emerging Basins

CatcherDevelopment

KrakenDevelopment

SkarfjellDevelopment


22/24

DeliveringvaluefromdiscoveryanddevelopmentDeliveringvaluefromdiscoveryanddevelopment

Simon ThomsonChief Executive



23/24


Strategic Delivery

Business well funded through to

sustainable cash flow from 2017

Balanced portfolio - appropriate equity interests

and size of company in current environment

Focus on potentially world class asset

in Senegal to increase shareholder value

Senegal 2015 / 2016 drilling programme



24/24


www.cairnenergy.com

Follow us on Twitter Download our IR iPad App View our YouTube Channel

Contacts

David Nisbet Group Corporate Affairs

E-mail:

[email protected]

Tel: +44 (0)7711 146 068

Kate Trevenen Investor Relations Co-ordinator

E-mail:

[email protected]

Tel: +44 (0)131 475 3094
http://www.cairnenergy.com/mailto:[email protected]:[email protected]:[email protected]:[email protected]://itunes.apple.com/gb/app/cairn-energy-plc-investor/id521644686?mt=8http://itunes.apple.com/gb/app/cairn-energy-plc-investor/id521644686?mt=8http://www.youtube.com/CairnEnergyhttp://www.youtube.com/CairnEnergyhttps://twitter.com/https://twitter.com/http://www.cairnenergy.com/

Documents

2015 Half Yearly Results Presentation