WASHINGTON, D.C., FEBRUARY 2, 2004
—The International Finance Corporation, the private sector arm of the World Bank Group, has signed a $40 million loan agreement with U.K.-based Cairn Energy PLC to support the expansion of its operations in South Asia, particularly in India and Bangladesh.
Cairn gained a foothold in the South Asian oil and gas sector after becoming one of the first private companies to operate in Bangladesh, where it discovered the Sangu gas field in 1996. Cairn then turned its attention to India as the country’s oil and gas sector opened up to private investments and acquired an interest in the Ravva field. Recent developments of the Lakshmi and Gauri fields have further increased the group’s contribution of fuel to the Indian energy market. Cairn has also built a portfolio of exploration acreage that has now started to yield significant discoveries.
Mr. Rashad Kaldany, IFC’s director for oil, gas, mining, and chemicals, noted, “Cairn has demonstrated a strong commitment to the region and to developing its resources with a high level of social and environmental responsibility.” He added “IFC’s long-term financing will help Cairn meet its investment commitments and pursue future opportunities in the region.”
According to Mr. Dimitris Tsitsiragos, IFC’s director for South Asia, “Oil and gas production can make an important contribution to the economies of South Asia. Cairn's expanded involvement in the region is an important signal of the ability of foreign investors to succeed in this sector, employing global best practices in technical and environmental management.”
Mr. Bill Gammell, Cairn’s chief executive added, “Cairn is delighted that IFC has joined our consortium of debt providers. IFC’s knowledge and experience across countries will add great value for Cairn in South Asia.”
The mission of IFC is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY03, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY03 was $16.8 billion for its own account and $6.6 billion held for participants in loan syndications.
