Cairn pipeline from Rajasthan behind schedule

Vol 13, PW 10 (22 Oct 09) Midstream & Downstream

Larsen & Toubro will have laid a little under half of the proposed 610-km crude evacuation pipeline from Barmer in Rajasthan to Salaya in Gujarat by December this year, amid lingering disagreement with operator Cairn India over the slow pace of work.

L&T confirms to this report that by December the company will have connected Cairn’s production facilities in Barmer with Radhanpur in Gujarat - some 240-km away. L&T was hired by Cairn on February 21 last year to lay 535-km of the 610-km pipeline and was originally supposed to have laid the entire stretch it is responsible for two months ago in August.

In stark contrast, Punj Lloyd - hired by Cairn this year to lay a separate 56.52 km stretch - has completed work. Not only is L&T behind schedule, it has also sub-contracted a 50-km stretch to KazStroy Services.

“When it won the Cairn contract L&T took on more work than it could handle,â€‌ reports an industry source. “L&T didn’t commit enough equipment to the project.

â€‌ L&T also ran into trouble when Jindal Saw, the pipe supplier for the entire stretch, delayed deliveries. Work was further delayed because Cairn had trouble securing RoU (Right of User) permission from Rajasthan.

Cairn might be unhappy with L&T, but the Indian contractor, we hear, is in turn unhappy with its sub-contractor KazStroy, as the Kazakhstan-based company has not yet completed its 50-km stretch. For this, KazStroy blames Cairn for its failure to secure RoU permission.

“KazStroy will refuse to pay any penalty for the delay,â€‌ says an industry source, “if L&T claims any penalty.â€‌ Despite the sparks flying around, L&T believes it can complete the pipeline up to Salaya on the Gujarat coast by March next year.

Overall, the Barmer to Salaya pipeline is approximately 610-km, with an additional 100-km stretch planned from Salaya to Bhogat port, also on the Gujarat coast.