<< Do you think that one of the major oil companies will buy us out. >>
A buy out has been speculated on in the past, but I've tended not to expect it, at least not in the next 3-5 years. There is just too much unrealized, unexplored value in the blocks that GGR is holding in India. A buyout before seismic is done on the Deccan Syneclise block (100% owned), for example, would be certainly selling ourselves short. A more likely scenario would be one similar to what we're seeing happening to GSPC's 80% share of the KG block -- a major coming in and buying some of that interest, after a find has been discovered/proven, but probably while retaining some percentage for ongoing cash flow.
I also feel that JPR has much more at stake than just making a quick billion or two, things like professional prestige and honor. Of course, personal circumstances could change things, even as the GGR legend continues to unfold in the subcontinent of India.
Total BS. No one in his right mind would buy this bubble. And complete BS about KG too. Not only this company only has a tiny 5% interest in KG Block, but also it is losing it.
The following is taken straight from form 424B7 filing from the company on 1/27/2006:
"The first of our agreements, entered into in February 2003, grants exploration rights in an area offshore eastern India. We refer to this as the "KG Block" and we have a net 5% carried interest under this agreement."
"Possible Inability of Contracting Parties to Fulfill Phase One of the Minimum Work Program for the KG Block Under the terms of our Production Sharing Contract relating to the KG Block, the first phase of the exploration period expired on September 11, 2005. The Production Sharing Contract provides that by the end of the first phase, the contracting parties, in addition to other parts of the work program which have been completed, shall have drilled at least fourteen wells. Through September 11, 2005, three wells had been drilled on the exploration block, leaving eleven wells to be drilled. The Production Sharing Contract provides that, if at the end of an exploration phase, a work program for that phase is not completed, the time for completion of the exploration program for that phase is to be extended for a period necessary to enable completion but not exceeding six months provided the parties (i) submit a request by written notice to the Government of India at least thirty days prior to the expiration of the relevant phase, (ii) can show technical or other good reasons for the non-completion of the work program, and (iii) the management committee gives its consent to the extension. Any such extension that is granted is to be deducted from the next succeeding exploration phase. On August 5, 2005, a written notice requesting the six month extension was submitted and on August 29, 2005, the management committee consented to the extension of six months to March 11, 2006 and deducted the six month extension from the Phase II exploration period.
In the event the eleven additional wells are not drilled by March 11, 2006, the Government of India would have the right to assert that the contracting parties have failed to comply with or have contravened a material provision of the Production Sharing Contract. Under such circumstances, the Production Sharing Contract will be subject to termination by the Government of India on ninety days written notice, unless such failure of compliance or contravention is remedied within the ninety-day period or such extended period as may be granted by the Government of India. In the event the Production Sharing Contract is terminated by the Government of India, or in the event the work program is not fulfilled by the end of the relevant exploration phase, each party to the Production Sharing Contract is to pay to the Government of India its participating interest share of an amount which is equal to the amount that would be required to complete the minimum work program for that phase. We are of the view that GSPC, under the terms of our Carried Interest Agreement, would be liable for our participating interest share of the amount required to complete the minimum work program for the phase. However, termination of the Production Sharing Contract by the Government of India would result in the loss of our interest in the KG Block other than areas determined to encompass commercial discoveries."