McDermott and L&T win Vashishta tender

Vol 19, PW 7 (03 Dec 15) People & Policy

Good news for McDermott and Indian partner Larsen & Toubro! ONGC issued them a LoA on December 1 for the long-delayed eastern offshore deepwater Vashishta and S1 subsea installation tender, overruling Technip which accused multiple bidders of influencing each other in violation of ONGC’s Integrity Pact.

Under the LoA McDermott and L&T must complete the assignment by October 31, 2017. On November 20 Technip complained to ONGC’s Independent External Monitors but the state-owned explorer’s eastern offshore asset went ahead and opened price bids at 4pm the same day at its Kakinada office.

McDermott partnering L&T bid lowest quoting $366.2m, followed by Subsea 7 at $511.55m and Technip UK with Technip India at $522.81m. Subsequently the IEMs met ONGC on November 27 to see if Technip’s complaint had merit.

Technip claimed rivals L&T and TL Offshore are linked through TL’s Malaysia-based parent SapuraKencana: L&T and Sapura have a joint venture L&T Sapura Offshore. Technip also said rival Subsea 7 has a joint venture with Sapura through SapuraAcergy.

This, it claimed, breached ONGC’s Integrity Pact barring bidders from influencing each other. But an industry source says ONGC opened price bids after receiving Technip’s letter because the previous evening its Executive Purchase Committee granted special permission to the Vashishta S1 tender committee to disregard such links between bidders.

TL and NPCC also earlier appealed to the IEMs after they were disqualified on September 26.