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Cairn India cuts capex by a third to $100 million for fiscal 2017

New Delhi: Battered by a slump in oil prices, Cairn India Ltd has slashed its capital expenditure for 2016-17 by a third to $100 million (around Rs.660 crore).

Cairn India had originally planned a capex of $1.2 billion for 2015-16, but later revised it to $500 million as oil prices started to fall.

In the third quarter, the firm further trimmed it down to $300 million.

In an investor presentation post announcing fiscal 2016 earnings, Cairn India said for 2016-17 a capex “of $100 million” is planned.

In 2014-15, the company had spent $1.1 billion of capital expenditure. At least 80% of $100 million planned investment will be for “development including Raageshwari gas (field) and Mangala enhanced oil recovery (both in flagship Rajasthan block) completion activities and 20 per cent in exploration,” it said.

The company, however, said: “Despite record low oil prices and substantial cut in capex, we will maintain the production broadly at FY16 level.”

Cairn’s flagship Rajasthan block produced 1,67,266 barrels per day of oil in 2015-16, down 3% from the previous year.

Gas output was 57% higher at 14 million standard cubic feet per day. The firm will “continue investing in pre-development activities of our key projects in core Mangala-Bhagyam-Aishwariya (MBA) fields, Barmer Hills and Satellite fiel