MSV dilemma at ONGC

Vol 15, PW 23 (31 May 12) News in Brief

A difficult dilemma confronts ONGC’s Executive Purchase Committee (EPC) over its tender to construct a Multi Support Vessel (MSV).

ONGC met Netherlands-based shipyard IHC Offshore & Marine on May 15 to negotiate down its $196m quote. IHC agreed to drop its rate to $185m.

But don’t throw a party yet: IHC’s bid is still approximately 46% higher than ONGC’s $135.75m (Rs723.64cr) internal estimate. “ONGC rules stipulate it must re-tender if the lowest bid received is 20% higher than its internal estimate,” we hear.

“If it awards the contract to IHC it will violate its own guidelines,” we hear. “Let’s see what the EPC decides.

” By December 31, ONGC also received bids from Dubai shipyard Drydocks World, Spain’s Factorias Vulcano and South Korea’s Hyundai Heavy Industries, the world’s largest shipbuilder. Factorias and Hyundai were disqualified on technical grounds.

Drydock’s $176m quote was mistakenly revealed before ONGC opened price bids, and therefore invalid.

LNG Summit