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Forex loss takes sheen off Cairn net

New Delhi, Jan. 23: Cairn India has reported a 14 per cent drop in net profit in the October-December quarter at Rs 2,884 crore compared with Rs 3,345 crore a year ago as foreign exchange loss ate into its revenues.

Revenue rose 17 per cent to Rs 5,000 crore, with output touching 224,493 barrels of oil and oil-equivalent gas a day.

Cairn’s showpiece Rajasthan fields produced 184,982 barrels of oil per day (bpd) during the quarter; the output may rise to 200,000 bpd at the end of the financial year as it puts the satellite fields to production.

The dip in profit was “primarily due to a foreign-exchange loss on the dollar deposits with the strengthening of the rupee to the dollar”, it said.

Also, the government’s share of profit from the Rajasthan fields went up to 30 per cent from 20 per cent.

Cairn had cash reserves of Rs 13,000 crore at the end of December and another $1.45 billion in dollar funds, part of which will be used for a Rs 5,725-crore share buyback that opened today.

The company announced two more oil discoveries in the prolific Rajasthan block in Barmer district, taking the total discoveries in the area to 28.

“Since the resumption of exploration in March 2013, nine exploration and appraisal wells have been drilled till the third quarter of the current fiscal. The initial results have been encouraging with three discoveries and a success ratio of over 50 per cent,” Cairn said, adding that the finds have added an estimated 500-600 million barrels of in-place oil resources.

Royalty payments

Cairn said it contributed Rs 6,400 crore to the central and state governments in taxes and royalties in the third quarter and Rs 18,800 crore in the first nine months of the financial year.

Besides, the Nagayalanka oil discovery in the onland block of the Krishna-Godavari basin is expected to add 10,000 barrels per day by 2017.

“Cairn remains committed to discover new resources and deliver accelerated value from its assets. Our focus on execution is yielding results,” Cairn India chief executive officer P. Elango said.

“Our strategy of active exploration across the portfolio opens up potential for resource accretion in the near term. We are keen on evaluating the blocks in Nelp-X announced by the oil ministry recently to build on our growth in India,” he added.

The renewed exploration and appraisal programme during 2013 resulted in three discoveries in Rajasthan and declaration of commerciality of the Nagayalanka discovery in KG-Onshore block, he said.

 
 
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