Attracting new companies to NELP-VII won't be easy
Efforts to attract small players to bid for exploration acreage in India will fail unless the DGH clamps down on â€کridiculous bids’ to win blocks.
Over the past week PETROWATCH has contacted several small companies interested in NELP-VII or who are operating in India already. Their verdict is unanimous: companies that tried but failed to get acreage in past rounds are unlikely to return, scarred by the experience of competing against aggressive and unattainable work programmes from rivals.
“Some of the bids in earlier rounds were ludicrous,†one NELP-VI participant tells us. “When you saw the work programmes offered you ask yourself, is it worth bidding again†Another company, already operating in India, adds diplomatically: “Small companies don’t have the â€کpolitical insight’ to compete with those sorts of bids.
You lose enthusiasm; it’s very disheartening.†Says a third company: “Most overseas companies can’t afford the risk of over-bidding or getting drawn into a work programme commitment they can’t keep.
If we witness another round of silly bidding it will put small companies off for good.†Ever optimistic, the DGH disagrees.
“The response has been tremendous,†reports a spokesman. “Shallow water blocks are the most sought after, followed by type â€کS’ blocks.
†Up to 50 companies have visited the Delhi dataroom, a dozen or so each in Houston and London, and eight in Calgary. This month the DGH announced the NELP-VII bid deadline will be extended to April 25 and the Singapore and Perth roadshows re-scheduled to March 28, 31 and April 1.
“Some companies asked for an extension,†adds the DGH. “We want to give sufficient time to companies such as Santos, Petronas and others based in this region.
†Few believe the extension will make any difference. Santos for example, has already visited the Delhi dataroom.
“Anyone who is interested in India will have already decided whether to bid or not,†stresses a potential bidder. “They won’t be waiting for the roadshow to turn up in Singapore or Perth.
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