overbidsLooks like these companies that won the bids are setting themselves up for failure. This was posted on the renaissance board....... After the award of 25 oil contracts in the third stage of the Round One --with royalties to the state that could theoretically reach 90 percent--, experts and companies launched yesterday doubts about the viability of those businesses. Friday, December 18, 2015 After the award of 25 oil contracts in the third stage of the Round One --with royalties to the state that could theoretically reach 90 percent--, experts and companies launched yesterday doubts about the viability of those businesses. On Tuesday, the National Hydrocarbons Commission held the contest that led to the placement of all blocks to exploit mature oil and gas fields in Tamaulipas, Veracruz, Chiapas, Tabasco and Nuevo Leon. Among the winners is the consortium of Dutch Canamex, Perfolat of Mexico and American Oil Tools, which provided 85.69 percent of royalties, additional 7.5 percent of their gross revenue to be surrendered to the State. "It exaggerated the royalty (...) I do not want to wait an energy recovery in one or two decades," said Raymundo Tenorio, a researcher at Monterrey Tech. Pablo Medina, an analyst at Wood Mackenzie, said this deal would have limited resources to invest because, after paying the royalty of their gross income, the remaining will serve the company to cover its costs and pay income taxes. Ramon Leal, director of Grupo Alfa Finance that participated winless with its subsidiary Newpek, described as amazing offers and considered unlikely to make money with income guarantees pledged. "We saw very aggressive people and that discouraging, with royalties of 80 percent I do not know how they do return on investment," he said. "They do not understand much, or do not mind the cost of money as much as us, or bring a magic formula." He stressed that GeoPark offers and Alpha were in line with market conditions and offered 40% royalty." Read more at https://www.stockhouse.com/companies/bullboard/bullboard/v.roe/renaissance-oil-corp#YCkfr5lsriUyuyCj.99