Rocksource still waiting for 10% ministry endorsement

Vol 13, PW 3 (16 Jul 09) Exploration & Production

Petrobras’ disinterest in exploration block CY-DWN-2001/1 can’t be said of Oslo-listed Rocksource, which values the block as one of its most prized assets.

More than a year has gone by since January 2008 when ONGC â€کfarmed-out’ 10% of its 55% stake to Rocksource. But unlike the 25% stake held by Petrobras, the 10% stake held by the Norwegian explorer has still not won oil ministry endorsement, something that doesn’t seem to worry senior Rocksource representatives in Oslo, contacted by this report.

“The process will take its own time,â€‌ we hear. “I have seen instances where it has taken much more time than this to complete a transaction.

â€‌ Lack of Indian government approval has not stopped Rocksource issuing regular press releases about the block, a move that raises eyebrows in some quarters. “I am not sure under what authority they issue these press releases,â€‌ we hear.

“As of today their 10% stake has not been sanctioned.â€‌ In its latest release on June 29, Rocksource chief Trygve Pedersen said: “With regards to Rocksource participation on block CY-DWN-2001/1 in India, the company is waiting for notification from the operator ONGC of the timing of the upcoming operational and management meetings.

â€‌ Nor has lack of government approval stopped Rocksource attending past block meetings. When they happen, ONGC is careful to classify Rocksource as a â€کguest’.

Rocksource is best known as a leading proponent of the much-hyped Controlled Source Electro Magnetic technology, a state-of-the seismic acquisition technique, best used in conjunction with traditional 3D. It’s not clear if CSEM technology was used to select drilling locations at CY-DWN-2001/1.

What is clear is that in July last year Discoverer Seven Seas drilled a dry hole at well CY-DWN-2001-1 and four months later drilled a second dry hole at well CY-DWN-2001-2. Until now, Rocksource has not paid its share of the cost of these wells and says it will respond to cash calls only when the government approves its 10% stake.