Investors raise concern over small size oilfields

India: Government has appealed to investors to place their bids for the auction of 67 small oil & gas fields that is underway and allows applicants until October 31. To promote the opportunity that the oil fields offer, the government is hosting roadshows in India and leading global financial centres such as London and Singapore. Some of the likely participants have raised doubts about the smaller size of the contract areas on offer and have requested the government to consider offering a bigger area as it limits their opportunity. However, a senior oil ministry official said that the government can't make any changes in the way the fields have been marked or are being offered. Investors should understand that these are discovered fields and not exploration fields. 

TechSci Research depicts that the upcoming E&P activities in 67 small oil & gas field would drive the demand for oilfield services market in India. These services are provided to smoothen the drilling process, thereby eliminating the waste produced during drilling and enhancing the oil recovery process by providing repair and maintenance of bore wells. Government’s decision of auctioning idle oil and gas fields of state-owned ONGC and Oil India to private companies on new revenue sharing model is expected to boost oil and gas E&P over the next five years, which in turn would fuel growth in the country’s oilfield services market through 2020. 

According to TechSci Research report, “India Oilfield Services Market Forecast & Opportunities, 2020”, the country’s oilfield services market is projected to surpass US$ 7.8 billion by 2020, on account of anticipated increase in oil and gas E&P activities. Onshore oilfield services segment holds majority share in India’s oilfield services market; however, the offshore oilfield services is forecast to exhibit higher growth during 2015- 2020. Comprising three vital type of services i.e. cementing, direction drilling, hydro fracturing services, drilling services segment accounts for the largest share in the oilfield services market, followed by drilling & completion fluids services, wireline services, pressure pumping services and coiled tubing services.