CBI receives complaint about L&T and ONGC

Vol 18, PW 23 (16 Jul 15) People & Policy

An anonymous whistle-blower has complained to the CBI over ONGC's award of a Rs379.18cr ($60m) pipeline re-routing contract to L&T Hydrocarbon Engineering without a tender, claiming the cost should have been 15 times less.

PETROWATCH learns the complaint was filed to the CBI on June 25, alleging ONGC was wrong to award L&T a contract on October 8, 2014 to replace and re-route a 1.9-km onshore stretch of the 244-km South Bassein Hazira Trunkline (SBHT), damaged by a cyclone in June 2014. This stretch connects the landfall point at Umbhrat to the Hazira gas processing plant and the contract is to reroute the pipeline to avoid the beach.

ONGC mandated L&T to complete work by July 31 (this month). "The cost of laying 1-km of onshore pipeline is only Rs10cr ($1.6m)," says an ONGC source.

"Laying a 1.9-km stretch shouldn't cost more than Rs25cr not Rs379cr." The complaint names ONGC group general manager Manas Chakraborty who signed the contract in addition to executive director and chief offshore engineering services Sachin Sain, GM-Head pipeline group SR Jaiswal, general manager SK Koshal, and DGM (E)-project co-ordinator Bharat Bhushan. "L&T Hydrocarbon is a new entity in pipeline engineering," reads the letter.

"This may be the first time it has taken such a contract. Why was such important work awarded without inviting a tender when companies like Dodsal, Punj Lloyd, and NPCC were not invited to bid?"