Greenland Operational Update

RNS Number : 6402L

Cairn Energy PLC

03 August 2011

 



FOR IMMEDIATE RELEASE                                                                                               3 August 2011

CAIRN ENERGY PLC ("Cairn")

Greenland Operational Update

The following operational update relates to Cairn Energy's exploration drilling campaign offshore Greenland.

LF7-1 Well: Lady Franklin Block, South Ungavva Area

The LF7-1 exploration well, located in 1,002 metres (m) of water approximately 300 kilometres (km) offshore Nuuk, has reached target depth (TD) in basement strata and preparations are under way to plug and abandon the well. The well encountered a thick Upper Cretaceous section with tight (cemented) sandstones although the anticipated stratigraphically deeper reservoir section was absent at this location. Initial geochemical analysis of the background gas composition indicates the presence of pre-Tertiary oil prone source rocks in the basin.

The Ocean Rig Corcovado is currently carrying out abandonment operations on the LF7-1 well.

AT7-1 Well: Atammik Block, South Ungavva Area

The AT7-1 exploration well in the Atammik Block, located in 909m of water 200km offshore Nuuk, has been temporarily suspended by the Leiv Eriksson. The AT7-1 well is currently suspended above the prognosed target objectives and the well is scheduled to be re-entered and drilled to planned TD at a later date in the current programme. With the opening of the weather window in the Disko area the Leiv Eriksson was moved 750km north to commence operations on the Delta prospect in the Napariaq Block, optimising the programme.

Delta-1 Well: Napariaq Block, West Disko Area

The Delta-1 well has spudded on the Delta prospect, located in a water depth of 293m approximately 100km off the Greenland coast and 110km northeast of the Alpha-1S1 well drilled by Cairn in the Sigguk Block in 2010.

Gamma Prospect: Eqqua Block, West Disko Area

The Gamma prospect in the Eqqua block, located in 1,520m of water and 110km southwest of the Alpha-1S1 well is scheduled to be drilled using the Ocean Rig Corcovado after operations on LF7-1 are complete.

A further update will be provided whenever a well is at TD and operations are complete.

Simon Thomson, Chief Executive, said:

"Although no reservoir has been found in the LF7-1 well, the first in the basin, we are encouraged by further indications of pre-Tertiary oil-prone source rocks across our Greenland acreage. The exploration challenge remains to find the reservoir sands. We continue to be optimistic about the remainder of our 2011 four-well, multi-basin exploration programme offshore Greenland."

Conference Call

Cairn will host a conference call at 08.30 BST on Wednesday 3 August 2011.  To dial in please call:

From within the UK:    0844 871 9449

Internationally:           [phone]

Conference ID:            88 85 06 90

An audio version and transcript of the call will be available to download from the Cairn website as soon as possible (within 24 hours) after the call has concluded.

Enquiries:

Analysts/Investors Simon Thomson, Chief Executive Mike Watts, Deputy Chief Executive Jann Brown, Managing Director and CFO David Nisbet, Corporate Affairs	Tel: [phone]
Media Patrick Handley, David Litterick Brunswick Group LLP	Tel: [phone]

NOTES TO EDITORS:

Cairn Energy PLC

Ø Cairn Energy PLC ("Cairn") is an Edinburgh-based oil and gas exploration and production company listed on the London Stock Exchange. Following the IPO of Cairn India in January 2007, there are two separate parts of the business:

·      Cairn India limited ("Cairn India") is listed on the Bombay Stock Exchange and the National Stock Exchange of India and has interests in a total of 11 acreage blocks in India and Sri Lanka. Cairn retains a 52.2% interest in Cairn India (on an un-diluted basis).

·      Capricorn Oil Limited ("Capricorn"), a subsidiary of Cairn is focused on exploration. Capricorn has assets in, Nepal, Northern India, Greenland, Albania and Spain.

Ø "Cairn" where referred to in this release means Cairn Energy PLC and/or its subsidiaries (including Cairn India and Capricorn), as appropriate.

Ø "Capricorn" where referred to in this release means Capricorn Oil Limited and/or its subsidiaries as appropriate.

Ø Cairn has focused its activities on the geographic region of South Asia, which has already resulted in a significant number of oil and gas discoveries.  In particular, Cairn made a major oil discovery (Mangala) in Rajasthan in the north west of India at the beginning of 2004. Cairn has now made more than 20 discoveries in Rajasthan block RJ-ON-90/1. Production from Rajasthan started in August 2009 and subject to Government of India Approvals is expected to reach a plateau of 175,000 bopd in 2011.

Ø Cairn Energy PLC (including Capricorn) is run from Edinburgh with operational offices in Tunis, Kathmandu and Nuuk.

Cairn in Greenland

Ø Cairn through its subsidiary, Capricorn, operates 11 blocks offshore Greenland.

Ø Cairn has plans to drill up to four wells offshore Greenland in summer 2011.  Two state of the art rigs are being used for the drilling and exploration programme - the Ocean Rig Corcovado, a sixth generation drill-ship, and the Leiv Eriksson, a fifth generation semi-submersible.

Ø Up to fourteen vessels are supporting the drilling programme.  They provide cover for emergency response, rig stand-by, ice management, anchor handling, oil spill response and re-supply operations.

Ø Cairn has carried out extensive Environmental and Social Impact Assessments to identify how potential environmental and social impacts of the drilling programme can be avoided or mitigated. 

Ø Only ten exploration wells have been drilled in offshore Greenland to date, five of which were drilled in the 1970s, one in 2000, three in 2010 and one in 2011 by Cairn Energy.  

Ø Subject to necessary approvals, geophysical surveys are also planned across the southern Greenland Basins in the summer of 2011.

For further information on Cairn see www.cairnenergy.com

 

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