Reduction of Capital

CAIRN ENERGY BANGLADESH LIMITED

(registered number SC48610)

Notice is hereby given that the share capital of Cairn Energy Bangladesh Limited (the “Company”) was by virtue of a special resolution passed on 10 May 2006, and with the sanction of the Court of Session in terms of an interlocutor of the court pronounced on 21 June 2006 (the “Order”), reduced from (a)

£272, 500,000 divided into 2,725,000,000 ordinary shares of 10p each (“Ordinary Shares”) of which

2,272, 500,000 Ordinary Shares were issued and fully paid up to (b) £51,244,570.20 divided into

512, 445, 702 Ordinary Shares of which 59,945,702 Ordinary Shares remain issued and fully paid up.

The reduction was effected by the registration by the Registrar of Companies in Scotland, on 22 June 2006, of a certified copy of the Order and of related minute setting out the Company’s share capital as confirmed by the Order.

Shepherd + Wedderburn, Saltire Court, 20 Castle Terrace, Edinburgh EH1 2ET.

Solicitors for the Company.