1) The document provides information on the Discovered Small Fields (DSF) Bid Round 2, including details on the 25 onshore and offshore blocks being offered, how bids will be evaluated, and factors companies should consider. 2) Bidding companies will need to propose how much revenue they will share with the government and how many new wells they will drill. The bid winner will be determined based on offering the highest government revenue share (80% weight) and most new wells (20% weight). 3) Additional considerations for bidding companies include development timelines, penalties for not meeting commitments, production profiles, and understanding the evaluation window used to assess bids. Outside consultants are recommended to assist with bid strategy and field

1. Are you planning to bid in
this DSF-2 round ?
Please read on...

2. 10 things which
probably you
already know
about DSF 2
1. As per government, these fields are already discovered which means
technically, there is a known reserve in place and you only have to bring
them out by solving engineering and logistics problems.
2. 15 Onshore Blocks ( Total 23 fields) in Assam (5), AAFB(1), Cambay (4),
Rajasthan(1) and Andhra Pradesh (4)
3. 10 Offshore Blocks (Total 36 fields).
4. DGH has published a summary of all above 25 blocks with previous
block owner’s opinion of prospects. You can find this summary here.
(Based on our experience from DSF-1, where we made detail Field Development Plan for 3 blocks, you should also do
your own detail evaluation of reserves before you bid.)
5. You have to bid how much revenue you will share with government in
LRP-HRP model. Government will calculate their NPV based on your
LRP-HRP and based on their estimated production profile.
6. In your bid, you have to submit how many new wells you will drill. This
has to match your net worth and has 20% weightage in evaluation.
Companies have to relinquish blocks even if theirs is winning bid if this criteria does not match.
7. Company which will bid max govt. NPV share (80% weightage) and
max new wells drilling (20% weightage) will be awarded the block.
8. All cost of drilling, workover, production facility etc is yours. All risk is
yours.
9. You will have 3 years to develop what you promised during bidding else
1 M USD penalty per well for onshore blocks. If you have not committed
any new drilling then 1 crore Rs is the penalty if you don't complete
your FDP.
10. 80% weightage is for govt. NPV (calculated using LRP-HRP) and 20%
for new wells drilled.

3. But….do you
know ?

4. This is the Evaluation Window for your bid
● Subset of LRP and HRP in X Axis
○ $XX & $ YY
● Your success depends on how your bid is
mapped in this window.
○ Irrespective of your production profile.
○ Vertical green lines in picture.
$10K $1MM
$XX $YY
Evaluation window Do You Know $XX & $YY ?

5. Know who is winning?
LRP_B
HRP_B
$10K $1MM
$XX $YY
Evaluation window
LRP_A
HRP_A
Case-I
LRP_B
HRP_B
$10K $1MM
$XX $YY
Evaluation window
LRP_A
HRP_A
Case-II
Same Production Profile
but different outcome

6. 10 more points which
you might find
interesting

7. 1. How much
revenue sharing
government is
expecting in
general in DSF-
2?
Approx 35%Expected revenue sharing from DSF-2
Number based on expected production
profile. News Article

8. 2. How much
revenue sharing
DSF1 winners
committed in
general ?
33%Average revenue sharing offered by DSF
1 winners
Number based on expected production
profile. News Article

9. 3. What range of
LRP, winners bid
for DSF rounds ?
From 3%of revenue
to 80%of revenue
Source

10. 4. How many
offshore blocks
companies bidded
in last DSF-1 round
?
8/20
And out of above 8, 1 contract was not awarded in the
end.

11. 5. How much
money you should
keep aside if you
win 1 average block
onshore ?
Approx 80 Cr. Rs.
Considering you plan to workover in 2 wells, drill 2 new
wells, set up logistics, small production facility and hire a
bare minimum team of staff for 3 years. This number vary
wildly depending on where you will be drilling, till what
depth you will go, what is the status of already drilled
wells, whether you require fracturing in the well and many
other variables. Contact Oges for detail cost estimate of
CAPEX and OPEX.

12. 6. How many DSF-1
winners were able
to successfully farm
out after winning
till date ?
0

13. 7. Cost of drilling 1
onshore well
Cost of drilling a well depends on its depth, state in
which well has to be drilled, whether that well
requires fracturing operation and kind of completion
string. Above approximation is for a western state
with depth of around 2500 meters.
Approx 20 Cr.

14. 8. OPEX of OIL
India in one quarter
of 2017
5.4 USD/boe
This is with all existing infrastructure (high CAPEX) but with a high number of
staff and reduced prices of services in 2017. 1 Quarter before their OPEX was
8.3 USD / boe. Source

15. 9. OPEX of ONGC in
first quarter of 2018
(approx average) Approx 10
USD/boe
One quarter before their OPEX was approx 12.5 USD/boe. ONGC has offshore
blocks too. Source

16. 9. Why companies
bid 99% in HRP and
does it matter ?
If your block produces 10,000 USD / day (with 80 USD
/ barrel rate, it is approx 125 bbl/day) then your
proposed number of government revenue sharing is
called LRP.
If your block produces 1 Million USD / day (with 80
USD/barrel rate, it is approx 12500 bbl/day) then your
proposed number of government revenue sharing is
called HRP.
If your block produces in between 10,000 USD and 1
Million USD then revenue sharing is calculated linearly.
So, all those who bidded HRP as 99% probably
assumed that their block will produce less than 10,000
USD/day or not much higher than that.
Please see slide 4 and slide 5 to understand more.

17. 10. Reserves in
DSF-2 blocks as per
technical booklet
provided by
authorities

18. About Oges
Oges has developed 3 Field Development Plans for DSF-
1 winners, so we are aware of real reserve potential and
amount of CAPEX required to bring that reserve out.
Oges helped in building a team for few DSF-1 winners.
Oges team consists of highly talented individuals who
have worked in India for average 15+ years with the
biggest oil and gas companies.
Oges is supported by ex-senior members of public
sector companies.
Oges has served DSF-1 winners in different capacities
and remains in touch with them from their time in
bidding in 2016 till now, so is aware of practical
difficulties of the entire process.
www.oges.co www.oges.info

19. Oges
workshop on
Advanced
Bidding
Strategies for
DSF and HELP

20. If you are serious
about bidding in
DSF 2 then do
consult Oges for
correct evaluation
and competitive
bid
Write us an email at
arjun@oges.info with your
phone number or send us a
Whatsapp message on +91-
8447 636 912 and we will get
back.

21. DISCLAIMER
This information is provided without any guarantee or
liability of any action taken from this information. User is
advised to do his or her own independent analysis and
independent checking of information before taking any
decision. This disclaimer applies to all 21 slides of this
presentation.