Hind criticises ONGC decision to cap age of vessels

Vol 16, PW 6 (04 Oct 12) Exploration & Production

Mumbai-based Hind Offshore has reacted furiously to ONGC’s September 5 decision to enforce a 27-year age cap on offshore support vessels that it hires.

“There is hardly any difference in ‘downtime’ between vessels older than 27 years and younger vessels,” claims Manish Kshirsagar, director operations at Hind Offshore, when contacted by this report. “But ONGC will end up paying between $20,000 to $25,000/day for new vessels which is more than double $10,000/day for old vessels.

” To stress his point Kshirsagar discloses internal ONGC ‘downtime’ data – periods when vessels are out of action for mechanical failure. In the five years between 2007 and 2012, Hind’s 29-year old ‘anchor handling tug supply vessel’ Sea Cheetah hired to ONGC for three years clocked up 477 hours ‘downtime’.

Contrast that, says Hind, with Great Offshore’s much younger six-year old Malaviya 28, which clocked up 684 hours of ‘downtime’ in the same period. More, says Kshirsagar, the approval process is just as stringent for old boats.

“Old vessels can be well maintained,” he adds. “They have experienced crew and are deployed only after 24 mandatory checks, just as new vessels.

” Hind and state-owned Shipping Corporation of India (SCI) will be the worst hit by ONGC’s decision to impose a 27-year age cap. In addition to Sea Cheetah, Hind has also hired 33-year old vessel Sea Jumbo to ONGC for three years.

Neither vessel would have qualified in ONGC’s most recent tender for 10 offshore vessels released on September 28; and when their contracts expire neither will be eligible for future ONGC tenders. SCI has hired nine (9) vessels to ONGC that are more than 27 years old, none will be eligible in future ONGC tenders.