High bids force ONGC to scrap east coast 3D tender
ONGC has abandoned its latest 3D seismic tender because it is unhappy with the high bids offered by Compagnie Generale de Geophysique and Western Geco.
We have to abandon the tender in its present form because the lowest bids are one and a half times more than our budget, reveals a source. ONGC wants to shoot 13, 044-sq km 3D across five exploration blocks in the Cauvery basin and five in the Mahanadi basin, both on Indias east coast.
CGG emerged L1 for the Cauvery blocks with its bid of $67m while Western Geco was sole bidder for the Mahanadi blocks with a bid of $132m. ONGC believes the Western bid is excessive.
We expected both bidders to reduce their quotes and match them with last years price, he said. But that has not happened and so we informed the EPC (ONGCs Executive Purchase Committee) that we may have to re-tender it either entirely or partly.
On 11th December, the EPC formally decided to scrap the tender. Surprised by the poor response, ONGCs material management team in Priyadarshini building Mumbai wants to save face by calling another bidders meeting this week.
The bidders will be requested to put an affordable price tag to 40% of the tender. If possible ONGC now wants to complete 40% of the seismic data acquisition before the end of June or July 2005.
Industry sources tell this report ONGC might approach PGS, which was disqualified from this tender on technical grounds, to take the job on nomination. ONGC doesnt deny this and adds that it is ready to approach any company, which has vessels available or with seismic boats already in Indian waters.
We are ready to offer any company three or four blocks from this current tender if it is ready to do the job at last years rates, he said. ONGC opened price bids for this survey on 19th November and has been bargaining for a 25% or more discount from CGG and WesternGeco.