Cairn India Q3 net up 12% at Rs 2,262 cr

Cairn India today reported a 12% rise in net profit for the quarter ended December 31, 2011, on back of higher crude oil price.

The net profit in October-December quarter was up 12% at Rs 2,261.9 crore from Rs 2,010.1 crore in the same period a year ago, Cairn said in a statement here.

Revenue was almost flat at Rs 3,096.8 crore in the third quarter of the current fiscal.

Cairn, which was acquired by London-based miner Vedanta Resources Plc last month, said it has started production from Bhagyam oilfield in the Rajasthan block and is looking at exiting the fiscal with 175,000 barrel of oil production per day from the block.

Bhagyam, the second-largest of the 25 oil and gas discoveries Cairn has made in the Barmer basin Rajasthan block, is likely to hit 25,000 bpd output by the month end and peak production of 40,000 bpd is likely in next few months.

Cairn currently produces 125,000 bpd of oil from Mangala oilfield which can go up to 150,000 bpd within days of government approval.

The company is awaiting government nod for raising Mangala output and once that comes in, it would calibrate production from the two fields so as to exit the fiscal with 175,000 bpd of output from the Rajasthan block.

Cairn said Rajasthan oil is priced at a discount of 8.3% to Brent and during third quarter it earned $101.1 per barrel as compared to $76 per barrel a year earlier.

Revenue and profit was lower by Rs 630 crore because of royalty payments on Rajasthan block being made cost recoverable after the deal with Vedanta.

Cairn holds 70% interest in the Rajasthan block while state-owned Oil and Natural Gas Corporation (ONGC) has the remaining 30%. The two have so far spent $3.3 billion in the block, the statement said.

Key contracts for bringing Aishwariya fields to production have been awarded and the third largest field in the block would begin output sometime in 2012.

Cairn India Managing Director and Chief Executive Officer Rahul Dhir said: "The commencement of production from the Bhagyam field is yet another significant milestone in Rajasthan."

"Our successive discoveries in Sri Lanka have established a working hydrocarbon system in the frontier Mannar Basin. This success demonstrates Cairn India's strong skill set, which we will continue to leverage for future opportunities. We have also notified the Sri Lankan Government about our intention to enter the second phase of exploration," he added.

Cairn said consequent to the change of control, three new directors -- Navin Agarwal, Tarun Jain and Priya Agarwal, were appointed to the company board.