This is my first year as Chairman. I am delighted to have taken over
the Chairmanship of your Company and would like to thank my
predecessor, Sir Bill Gammell, for his exceptional stewardship of the
Company. Cairn India is a great company with a very well established
The performance of Cairn India is testament to the strength of our
people. Their unrelenting commitment is admirable. Following the
completion of the Vedanta Group's purchase of the majority share in
Cairn India Limited, your Company is well poised for its next phase of
We are witnessing continuous global economic uncertainty. Global
economy, though recovering, has been put under threat by the Eurozone's
financial turbulence. These prevailing uncertainties have subdued the
oil markets with the resultant impact on prices and volatility. We are
living in a very interdependent world. Developing economies like India
are especially vulnerable to volatility in oil prices - our import
dependence is increasing. With expected growth in demand for oil, it
would be critical for the nation to secure energy supplies.
Your Company's world class assets in Rajasthan have played a
significant role in securing nation's energy supplies, to the nation's
excheguer, and to the development and income generation in the states
of Rajasthan and Gujarat. During the year, we reduced oil imports by
US$ 6 billion.
FY2012 was an exciting year for your Company. Cairn India reached an
important milestone: crude oil production from the Rajasthan block
touched 175,000 barrels of oil per day (bopd). Similarly, your Company
also commenced production from the Bhagyam, Raageshwari and Saraswati
fields in Rajasthan.
Your Company's international foray met with successes. The discoveries
in Sri Lanka were the first in 30 years. We have now entered our second
phase of exploration.
Your Company's Board of Directors has approved its dividend policy. We
aim a dividend payout ratio of around 20 per cent of the annual
consolidated net profits to our shareholders.
We operate in an industry, where our commitment to the health and
safety of our people and sustainability of the environment and
communities in which we work, are very critical. I am committed to meet
our world-class standards in safety and operational excellence, and I
am guite confident that everyone in Cairn India joins me in that
The support of the Government of India, the state governments, our
joint venture partner ONGC, local communities and key contractors has
been a key enabler. I personally thank all for their help. On your
behalf, I also wish to thank all employees of your Company for their
focus and commitment on finding and producing energy safely, reliably
I remain confident that we will continue to meet India's energy
challenges and deliver enduring value for our shareholders. With the
talent and commitment of the people of Cairn India, we are strong,
resilient, and well-positioned for the future.
Looking forward to FY2013, we remain committed to operate our business
efficiently. Your Company is now in a strong position to work towards
basin production potential of 300,000 bopd, subject to further
investments and approvals from our Joint Venture partner, the Oil and
Natural Gas Corporation (ONGC) and the
Government of India. Despite the current economic uncertainties, the
outlook for oil price remains good and we are preserving our investment
We are proud to produce energy for India. Jai Hind!
Date: 20 April, 2012