OIL and gas group Cairn is celebrating its fourth major discovery at the site it acquired from Shell for £4m two years ago.

Shares in the Edinburgh company made further gains following the latest announcement relating to its work in northern Rajasthan, in India.

Cairn said the full extent of the discovery had yet to be determined, but estimated the amount of oil in place at about 300 million barrels. Talks will take place with the Indian government about extending the block so it can better appraise the find.

Bill Gammell, chief executive, described the discovery as significant.