UPDATE: Cairn India Raises $1.6 Billion Debt For Field, Repay Debt
October 14 2009 - 9:48AM
Dow Jones News
Cairn India Ltd. (532792.BY), a unit of U.K.-listed Cairn Energy
PLC (CNE.LN), said Wednesday it has arranged $1.6 billion of debt
to fund the development of its oil fields and to repay an existing
$850 million loan.
The borrowings, in dollars and Indian rupees, have a tenure of
six years, the oil producer said in a statement.
"This (fundraising) is in line with our strategy of funding
development expenditure through debt and realigning the company's
capital structure to provide financial flexibility for the future,"
Chief Executive Rahul Dhir said.
Cairn India operates and has a 70% stake in the RJ-ON-90/1 oil
block in the western state of Rajasthan, where Oil & Natural
Gas Corp. (500312.BY), the country's largest oil and gas producer,
holds the remaining 30%. The block includes Mangala, Aishwariya,
Saraswati and Raageshwari fields.
Cairn India pumped in $2.0 billion before it began production at
the Mangala field in the end of August. The company will invest
another $1.1 billion-$1.3 billion over the next two years to ramp
up output, it said at that time.
Cairn India said the $1.6 billion debt it raised includes $750
million from abroad - $500 million fully underwritten by Standard
Chartered Bank and $250 million from World Bank unit International
Finance Corp.
State Bank of India underwrote domestic borrowing of INR40
billion ($850 million).
-By Rakesh Sharma, Dow Jones Newswires; +91-11-4356-3334;
rakesh.sharma@dowjones.com