Annual Report 2007 in PDF - Cairn Energy PLC

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CAPRICORN seeks to discover hidden value through entrepreneurial exploration and establishing strategic positions in frontier locations with high potential. in addition to its positions in bangladesh and nepal, the main strategic objective for capricorn in 2007 was to secure new acreage opportunities offering longterm organic growth potential. the successful implementation of this strategy is evidenced by the entry into tunisia, as a result of the corporate takeovers of plectrum and medoil, and the acquisition of new acreage in greenland. capricorn continues to evaluate further potential growth opportunities. capricorn now has assets in south asia (northern india, bangladesh and nepal), the mediterranean (tunisia, albania and, pending licence awards, in spain and sicily), peru, papua new guinea and greenland. as a result of an ongoing rationalisation programme, the exploration interests inherited from plectrum in australia (bremer basin) and in the uk (west of the shetlands) are considered to be non-core assets. 20 CAIRN ENERGY PLC ANNUAL REPORT 2007 Bangladesh production and development an offshore drilling campaign in block 16 commenced in january 2007 during which two wells (south sangu-3 and sangu-10) were drilled. the appraisal well, south sangu-3, was drilled to evaluate the earlier south sangu discovery and encountered subcommercial quantities of gas. the development well, sangu-10, was drilled as an extended reach delineation well in the main sangu field and encountered gas in new sand above the main producing intervals contained in what is considered to be a small, isolated gas-bearing reservoir. production from the sangu field is declining and efforts are being focused on extending the economic life of the field. the separate shallower reservoir in sangu-10 was brought on production in march 2008 as part of an ongoing well intervention programme at an initial rate of 20 mmscfd. exploration a two-well exploration drilling programme over the 2007/08 winter has resulted in a gas discovery in normallypressured reservoirs in the magnama 1 well, while gas shows were encountered in the hatia 1 well. further appraisal work will be required over magnama before commerciality can be established and consideration is being given to evaluating the updip potential at hatia. greenland capricorn announced on 10 january 2008 that it has an interest in six hydrocarbon licences offshore of west greenland, having recently been awarded four blocks and acquired an interest in a further two blocks in a transaction with encana corporation. the six exploration blocks cover a combined total area of approximately 52,000 km 2 . capricorn’s interests are as follows: • an 87.5% operated interest in two blocks (sigguk and eqqua) awarded in the disko west licencing round; • a 92% operated interest in two blocks (saqqamiut and kingittoq) awarded in the open door area; and • a 40% non-operated interest in two blocks (atammik and lady franklin) acquired from encana. it is the intention to acquire 8,000 km of 2d seismic over the operated blocks in 2008/09. an electromagnetic survey is being planned over the atammik and lady franklin blocks during 2008 by encana, the operator. in line with its licence agreements, capricorn is working with the national oil company, nunaoil a/s and the greenlandic and danish authorities to ensure compliance with the environmental regulations and procedures covering exploration activities offshore of greenland.
nePal the security situation in nepal continues to be monitored closely. contractual force majeure remains in place in capricorn’s acreage in nepal precluding new seismic acquisition. as soon as the security situation permits, final planning for seismic field operations will recommence. tUnisia the key objective of the plectrum and medoil acquisitions was to acquire a material acreage position in tunisia and capricorn now has a 50% interest in the nabeul permit and a 100% interest in the louza permit, both of which are operated by capricorn and are located offshore of tunisia. it is currently planned to drill two to four exploration wells in tunisia between q4 2008 and q4 2009 with first activity commencing on the louza permit. other assets seismic surveys are being planned for offshore blocks in albania and peru for 2008/09. licence applications have been made in sicily and spain. blocks in the bremer basin (australia) and west of the shetlands are considered non-core assets. talisman, the operator for block prl-1 in papua new guinea, is seeking a licence extension and, if that is granted by the government, is planning to acquire a 3d seismic survey in 2009 over the pandora gas field and other prospects. Qaqortoq, Greenland Cambay Basin, India CAIRN ENERGY PLC ANNUAL REPORT 2007 21
Page 1 and 2: ANNUAL REPORT & ACCOUNTS 2007 CAIRN
Page 3 and 4: CAIRN is an edinburgh based oil and
Page 5 and 6: CAIRN INDIA performance First comme
Page 7 and 8: 2000 lakshmi disCovery 2001 sarasWa
Page 9 and 10: THE RESTRUCTURING OF THE GROUP INTO
Page 11 and 12: ajasthan midstream the government o
Page 13 and 14: Cambay Basin, India CAIRN ENERGY PL
Page 15 and 16: Cairn india assets 30% 30% 49% 40%
Page 17 and 18: Rajasthan, India the increased reso
Page 19 and 20: Detail heading here relore min ullu
Page 21: uk (West Of shetland) Block 214/19
Page 25 and 26: angladesh reserves sangu gross 2p r
Page 27 and 28: activities in all operated blocks.
Page 29 and 30: 2007 marked the beginning of a new
Page 31 and 32: key financial performance indicator
Page 33 and 34: CAIRN INDIA CAPITAL EXPENDITURE FOR
Page 35 and 36: 3 9 12 4 8 1 Sir Bill Gammell, Chie
Page 37 and 38: 2007 ACCOUNTS Risk Factors 36 Corpo
Page 39 and 40: RISk FACTORS CONTINUED The developm
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Page 43 and 44: CORPORATE GOVERNANCE STATEMENT CONT
Page 53 and 54: DIRECTORS’ REPORT CONTINUED At 31
Page 55 and 56: DIRECTORS’ REPORT CONTINUED Elect
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Page 59 and 60: DIRECTORS’ REMUNERATION REPORT Re
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PRINCIPAL LICENCE INTERESTS ASIA In
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GROUP INCOME STATEMENT For the year
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BALANCE SHEETS As at 31 December 20
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NOTES TO THE ACCOUNTS For the year
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NOTES TO THE ACCOUNTS CONTINUED Net
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RESERVES Direct Direct working enti
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NOTICE OF ANNUAL GENERAL MEETING No
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NOTICE OF ANNUAL GENERAL MEETING CO
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GLOSSARY OF TERMS CONTINUED TECHNIC
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