Chinese company faces retaliation in LEWPP-3

Vol 19, PW 21 (30 Jun 16) Exploration & Production

Some are speculating a Chinese company which bid for a major ONGC EPC contract is likely to be disqualified in retaliation for China opposing India's entry into the Nuclear Supplier's Group last week in Seoul.

By the extended June 23 deadline in ONGC's tender for the Life Extension of Well Platforms Project-3 (LEWPP-3), a subsidiary of state-owned China National Offshore Oil Corporation submitted a bid, as did National Petroleum Construction Company (NPCC), SapuraKencana, Larsen & Toubro and Swiber. "ONGC is wary of allowing Chinese companies into the (Indian) offshore business," says a source.

"After the Nuclear Supplier's Group debacle ONGC will be even more resistant to the Chinese." LEWPP-3 involves cutting away and replacing the decks of 10 offshore platforms. Of those expected to stay in the race, Malaysia's SapuraKencana and Abu Dhabi-based NPCC are emerging the main rivals for the job which ONGC estimates to be worth $150m.

"NPCC has good experience of such work as does Sapura," we hear. L&T is the only Indian company which has done this kind of work, but is far less experienced than NPCC and Sapura.

Swiber's chances are poor because it does not have its own yard, and AFCONS sensibly stayed away because it has never done platform replacement work and is already busy with the LEWPP-1 and LEWPP-2 contracts, which it won.