Poten & Partners caught up in IOC tender row

Vol 15, PW 10 (17 Nov 11) People & Policy

IndianOil has hit back at allegations of bias towards Poten & Partners in a tender to hire a LNG sourcing consultant.

Poten, Ernst & Young and one Collin Biggs (believed to be an independent industry professional of British origin) submitted technical and price bids in October in IOC’s tender to hire a LNG sourcing consultant for its proposed 5m t/y LNG terminal at Ennore in Tamil Nadu, which is still very much on the drawing board. IOC has yet to award the contract but rumour abounds that the tender’s eligibility criteria were tailored to give Poten an edge over competitors, a claim IOC strenuously denies.

Just six companies attended IOC’s pre-bid in Delhi on September 30, even though 15 companies bought tender documents. Among those that attended were Poten, Ernst & Young, KPMG, PwC, ICF International and CRISIL.

A source tells us all participants, barring Poten, protested against IOC’s eligibility criteria. “IOC said it wants to select a consultant based on the quality of past work,” he said.

“They also said only bids submitted by the most technically qualified who fulfil the eligibility criteria would be opened.” IOC, he adds, said it would give one point under its bid scoring system to any company active in the LNG sourcing business for 20 years.

But it would give 10 points to a company with 10 employees, for example, who had exclusively sourced LNG for 10 years. If a company had more such employees it would get more points.

But IOC specified that only full-time employees count, not outsourced consultants. This demand, we are told, was termed “ridiculous and biased” by most companies at the pre-bid.

“None of us has a dedicated team of 10 people sourcing only LNG,” adds another angry source. “Only Poten qualified.

IOC designed the tender for them.” When contacted, an IOC source dismissed the allegations as “baseless.

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