CAIRN Energy is best placed among stock market- listed European oil and gas firms to deliver success through exploration as budgets come under pressure following the slump in the crude price, analysts have said.

Predicting cuts of around 30 per cut in exploration spending across the industry, analysts at UBS said Edinburgh-based Cairn's success off Senegal in West Africa helped it stand out among European exploration and production companies.

"We see Cairn Energy ... with its emerging Senegalese oil play as best positioned to grow its NAV (net asset value) through the drill bit this year," said the analysts in a report on the oil and gas sector.

Cairn made two potentially significant finds off Senegal last year. The finds put Cairn into the category of firms that are set to appraise recent finds, which the analysts believe could attract investor interest.

Last month Cairn said it plans to drill three exploration and appraisal wells off Senegal.

With cash on the balance sheet Cairn could benefit from a fall in the cost of oil services such as drilling support.

The UBS analysts wrote: "High cost frontiers, such as the Arctic, deep-water, long-term gas, and unproven unconventional plays will be out of favour."

Cairn has spent more than $1bn exploring off Greenland without making a commercial find but has no current plans for more wells.