Killajoules

$3.5 Billion Return of Cash to Shareholders
On 8 December 2011 Cairn announced the proposed return of approximately $3.5 billion of cash to Shareholders following the completion of the disposal of a 40 per cent shareholding in Cairn India to Vedanta Resources plc (“Vedanta”) in two tranches (the “Sale”).

Part sale of Shareholding in Cairn India to Vedanta
Vedanta has confirmed that it has now satisfied the conditions under the Sale and Purchase Agreement for the acquisition of a controlling shareholding in Cairn India.

As previously announced, Cairn intends to return a substantial proportion of the proceeds from the sale to shareholders. A further announcement in this respect will be made in due course.

Cairn will now retain an approximate 22 per cent shareholding in Cairn India.

Proposed part sale of shareholding in Cairn India Limited Cairn India to Vedanta Resources plc
Cairn and Vedanta have agreed to certain adjustments to the Transaction sale and purchase agreement for the sale of part of Cairn Energy PLC’s shareholding in Cairn India, involving the removal of the non-compete arrangements and associated fee, which are expected to result in a 5.3 per cent reduction in post-tax proceeds. Cairn and Vedanta have also agreed that completion of the Transaction will take place in two tranches: an initial sale of a 10 per cent stake in Cairn India, and a subsequent sale of a 30 per cent stake which remains subject to receipt of the necessary consents and approvals from the Government of India.