Environmental Impact Assessments

To assess the potential environmental impacts associated with our operations, we utilise EIAs or combined ESIAs.

As part of these assessments, we monitor a number of performance indicators associated with the environmental aspects of our activities. These include physical disturbance, air quality, atmospheric emissions and noise, energy consumption, water effluents, water consumption, and a variety of discharges, wastes and spills.

In 2009, we carried out EIAs for our activities in Greenland, in meeting our obligations to the Greenlandic authorities. We have also initiated the EIA for our proposed drilling activities in 2010. EIAs were also completed for seismic activities in Albania and Bangladesh, as well as ESIAs for seismic activities in Sri Lanka and for trucking operations in Rajasthan and Gujarat, India. EIAs for possible future drilling activities in Albania will also be completed in 2010.

Overview of EIA Approach

The main objectives were to:

• provide a detailed description and analysis of the environment before the project started, so that we could set a baseline for environmental management planning, mitigation and monitoring;
• identify potential environmental impacts of the planned drilling programme, at both a national and local level;
• avoid, mitigate or compensate for any negative impacts arising from our activities; and
• develop an Environmental Protection Plan that involved all relevant stakeholders in consultations and public hearings.

We also evaluate the importance and sensitivity of biodiversity within our EIAs and, where this is deemed to be significant, biodiversity management plans are put in place. The most important areas of Cairn's exploration acreage with respect to biodiversity are in Greenland and Nepal, so biodiversity management plans will be developed for all future operations in those countries.