Drilling Report

Cairn Energy PLC
21 February 2003


EMBARGOED FOR RELEASE AT 0700

                                                                21 February 2003

                                CAIRN ENERGY PLC


                 Block CB/OS-2 Offshore Gujarat, Western India
                     Successful Lakshmi Oil Field Appraisal


Cairn announces today that it has successfully completed a second Lakshmi oil
appraisal well. The CB-A-5  well was drilled on the north eastern flank of the
field 7 kilometres from the initial discovery well (LA-2) and encountered oil
bearing reservoirs in the same stratigraphic interval. Petrophysical logs and
core data from the well confirmed high quality oil bearing reservoirs consistent
with those encountered in previous wells.

In April 2002, the LA-2 discovery well flowed at a combined rate of 10,500
barrels of oil per day and was followed by a successful appraisal well (CB-A-3)
in May 2003. This first appraisal well was located 3.5 kilometres north west of
the initial discovery.

The CB-A-5 well results are in accordance with the pre-drill prognosis and are
consistent with Cairn's current estimates of oil initially in place of 100-300
million barrels with mean recoverable reserves of 66 million barrels.

The rig is now being moved to the CB-A-4 appraisal well location on the north
western flank of the structure, 4 kilometres to the west of the initial
discovery.


Enquiries:-

Cairn Energy PLC:

Bill Gammell, Chief Executive                             Tel:    [phone]
Dr Mike Watts, Exploration Director                       Tel:    [phone]
Kevin Hart, Finance Director                              Tel:    [phone]


Brunswick Group Limited:

Patrick Handley, Catherine Bertwistle, Mark Antelme       Tel:   [phone]


Notes to Editors:-

1.   'Cairn' where referred to in this release means Cairn Energy PLC and/or
     its subsidiaries, as appropriate.

2.   Cairn holds a 50% interest in the ring-fenced Lakshmi development area 
     in Block CB/OS-2. The remaining interests are held by Oil & Natural Gas 
     Company Ltd. ('ONGC') with 40% and TATA Petrodyne Limited with 10%.


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