As tempers fray ONGC extends FPSO deadline

Vol 20, PW 19 (15 Jun 17) Exploration & Production

ONGC has extended the deadline to receive pre-qualification documents in its $1.3bn tender to hire a FPSO from June 6 to June 21 following serious disagreements with interested companies at the May 11 pre-qualification meeting.

In dispute is why ONGC has banned bids from consortia and why it insists on five years FPSO operating experience. "Why can't it be three or four years?" asks a potential bidder.

Some expect another extension because ONGC has yet to answer queries from the May 11 meeting; typically bidders will need another three weeks to submit documents. Among those in attendance on May 11 at ONGC's Green Building in Mumbai's BKC were MODEC, SBM Offshore, Shapoorji Pallonji with Bumi Armada, Malaysia International Shipping Corporation, Essar Offshore Subsea, SCI, Hallworthy Shipping and Solar Turbines.

ONGC needs a FPSO (typically a converted oil tanker with onboard processing facilities) to handle expected production from the eastern offshore Cluster-2 deepwater field at KG-DWN-98/2 where on March 26 last year (2016) directors approved a $5.076bn development programme. Happily ONGC has ended uncertainty over the contract duration by confirming it wants to hire the FPSO for nine 'firm' years with an option to extend the contract by one year every year for up to seven years.

After ONGC completes the pre-qualification process, it will shortlist companies to whom it will send tender papers and these companies will in turn get four months to prepare and submit bids.