PREMIER OIL: BETTER LUCK IN INDIA

Vol 3, PW 12 (07 Jul 99) Exploration & Production
     

Patience pays dividend, and the exemplary patience shown by Premier Oil in its dealings with the Indian oil ministry for the discovered Ratna and R Series of oilfields in the Bombay Offshore may be about to pay off.

After months of false alarms - many unwittingly carried by this report - the Indian oil ministry tells Petrowatch it will call on Premier Oil (10%) and its Indian partners Essar Oil (50%) and ONGC (40%) to begin Production Sharing Contract (PSC) negotiations with the government before the end of July this year. "We are framing the guidelines for negotiations", a source on the Indian government side tells this report, "We hope to invite them for preliminary talks within the next couple of weeks.

Well give them the model contract to take home and ask them for their comments. Then well meet again for a second round three to four weeks after that".

Encouraging words, but will it happen Premier has been waiting five years to begin PSC talks for Ratna, a medium-sized field located 175km southeast of the giant Bombay High. If this time the words translate into a PSC, it will give a much needed boost to not just Premier but also Essar Oil, part of the troubled Essar Group of companies.

ONGC estimates recoverable in place reserves of Ratna at 90m tonnes (630m barrels). Ratna is one of 12 concessions awarded from an auction of small and medium-sized fields in 1994.

Along with Premier and Essar, the oil ministry is readying itself to invite the winners of the remaining 11 small fields for PSC negotiations. It vehemently denies Indian press reports that the government is planning to overturn the awards.

Table: List of pending awards for discovered fields:- FIELD CONSORTIUM AREA LOCATION Ratna Essar/Premier 57.6 sq km Bombay Offshore Sanganpur Hydrocarbons Resources 4.4 sq km Cambay Karjisan Selan Exploration 5 sq km Cambay Ognaj Selan Exploration 13.65 sq km Cambay Amguri Assam Oil/Joshi Tech 52.75 sq km Assam North Balol AMEC/GSPC/HOEC 27.3 sq km Cambay Kanawara AMEC/GSPC/HOEC 6.3 sq km Cambay Allora AMEC/GSPC/HOEC 6.85 sq km Cambay Unawa AMEC/GSPC/HOEC 5.65 sq km Cambay North Kathana AMEC/GSPC/HOEC 12.2 sq km Cambay Dholasan AMEC/GSPC/HOEC 8.8 sq km Cambay