Three favourites to clinch ONGC jack-up contract

Vol 11, PW 24 (17 Apr 08) Exploration & Production

Aban Offshore, Mercator and Greatship – all Indian companies - are widely seen as frontrunners to clinch ONGC’s tender for two â€کnew-build’ jack-ups for five years each, issued on April 10.

Anyone with a new jack-up under construction will be eagerly bidding in this tender in which ONGC wants both rigs mobilised by December 31 next year. “This tender has been expected for some time,â€‌ says a source.

In addition to this tender, ONGC is expected to issue two further tenders: one for Friede & Goldman rigs and a second tender for rigs to drill high temperature-high pressure wells. Many companies are likely to buy the April 10 tender documents for two jack-ups by the May 9 deadline but Great Offshore, Jindal, Mercator, Greatship, Transocean and Saipem are the only serious contenders.

Barring Saipem and Transocean, all are Indian. “ONGC is likely to get very competitive rates,â€‌ we hear.

“This always happens when Indian companies bid against foreign bidders.â€‌ Unlike Transocean and Saipem, Indian bidders will also benefit from preferential pricing.

Only Aban, Mercator and Greatship are likely to receive their â€کnew-builds’ by the ONGC mobilisation deadline. Aban is expecting one of its Deep Driller rigs by December this year; one of Mercator’s â€کnew builds’ is about six weeks ahead of schedule and could be delivered by March next year; Greatship has a â€کnew-build’ which will be available between October and December 2009.

What are Great Offshore and Jindal’s chances “Great Offshore is supposed to mobilise a â€کnew-build’ for ONGC by May 2009 but this is likely to be delayed,â€‌ we hear. “If they can’t mobilise in time they face termination of the contract.

â€‌ In July 2007, Great Offshore signed a contract with ONGC for a â€کnew-build’ jack-up but problems at the yard mean it might miss its delivery schedule. “Great Offshore is not a serious contender for this tender,â€‌ we hear.

“They have enough problems of their own with their earlier contract.â€‌ Jindal’s strategy is unclear (some predict it will offer a Noble Drilling rig) as are the strategies of Transocean and Saipem.

“Both of them,â€‌ we hear, “can throw up last minute surprises because of their size and muscle power.â€‌