Foreign operators work together to cut costs in Assam

Vol 8, PW 25 (23 Mar 05) Exploration & Production

Foreign operators in the northeast are stepping up cooperation to convince service contractors that it is worth their while to establish a permanent presence in the region.

There are no foreign service providers in Assam, one explorer tells us. In Gujarat you have a call-out service but in Assam we have no such luxury.

In Gujarat the cementing guys can be with you in two days but in Assam theres no one. Schlumberger and Halliburton both have offices in the northeast, but these are dedicated exclusively for ONGC and Oil India.

Halliburton welcomes the foreign operator initiative. We have been telling them to do this for a long time, reveals a source.

If the volume of business is enough we would definitely station someone there. Harsh terrain and the long distance from Mumbai make the northeast a particularly expensive place to work.

But that could change if operators club together parts of their work programmes. If I have a cementing job for five wells it doesnt make sense for a contractor to come here if he has to get kit from Singapore or Dubai adds the explorer.

But if others have cementing jobs those five wells could become 12 wells and everyone wins: contractors get more business and we share the demob and mob costs. Premier of the UK, Canoro of Canada and GeoEnpro, an Indo-French joint venture, all work in the northeast.

Cooperation, though, is informal. Hopes are alive this will change and they can become a formal group that could later include Oil India and ONGC.

Inspiration for the idea comes from Myanmar. In Myanmar onland operators get together regularly to share information and cut costs, we learn, In India theres no tradition of this.

Long term the operators hope to consolidate into a lobby group that could present a united front when approaching authorities to discuss security issues another major impediment to working in the northeast.