Storm as ONGC endorses 27-year vessel limit

Vol 16, PW 5 (20 Sep 12) People & Policy

ONGC stands accused of compromising the safety of its offshore personnel, rigs and installations by continuing to hire decrepit support vessels that are more than 20-years old in defiance of global norms.

Anger is growing after a meeting on September 5 of ONGC’s influential Executive Purchase Committee headed by company chairman Sudhir Vasudeva endorsed a proposal to allow ONGC to continue hiring vessels up to 27-years old. “Globally no one uses vessels more than 20-years old,” says a shocked contractor.

“ONGC is a glaring exception.” State-owned Shipping Corporation of India (SCI), Greatship and Great Offshore are among those affected by the ONGC move.

All have invested heavily in modern support vessels with an average age of five. But they are routinely outbid in ONGC tenders by Hind Offshore, Tag Offshore, Arc Marine and Great United Energy, who often offer boats older than 20 years.

“Scrapped or rejected vessels are bought for $2m and sent to India,” we hear. “Safer new vessels cost $20m to manufacture and they have DP-2 Class (Class 2 Dynamic Positioning) systems.

” With low overheads, old boats command rates of just $8000/day, compared to $11,000/day for a modern 80-tonne tug or $15,000/day for a new platform supply vessel. “ONGC is the only operator in India that uses such old vessels,” adds a source.

“This hugely compromises safety.” Cairn India, we hear, has a 10-year age limit on its vessels; GSPC is stricter, with a seven-year limit; BG has a 14-year limit; Reliance a 15-year limit.

Only HOEC among Indian operators has a relaxed 20-year limit. BP has a 5-year limit for its vessels offshore Angola; Shell has a 15-year limit for its boats offshore Malaysia.