Scramble for 5-year boat contracts with ONGC

Vol 19, PW 10 (28 Jan 16) Exploration & Production

After an overwhelming response in its tender to hire 18 boats for five years, ONGC is preparing to profit from a price war between desperate bidders.

ONGC received 89 vessel offers from 21 bidders by the extended January 6 deadline. For the 11 Anchor Handling Tugs (AHTs) required – each of 80-tonne bollard pull capacity – offers were received for 39 vessels.

For the seven Platform Supply Vessels (PSVs) needed – each of 3000 deadweight tonnes – ONGC received 50 boat offers. “This shows how bad the market is,” says a bidder.

“It’s impossible to guess what prices have been bid but one thing’s clear: pricing will be the winning factor.” Another bidder says the vessel hire market is in a desperate state as Brent crude continues its downward spiral.

ONGC is likely to open price bids in March and wants vessels mobilised within 45 days of the LoA. Each vessel should be no more than 21 years old as on January 6.

This disqualifies Great United Energy’s sole offering PSV Adinath One and Hind Offshore PSVs Sea Jumbo and Energy Girl. Industry sources speculate that rates will be below those at which ONGC hired two PSVs and two 80-tonne AHTs in June 2015 for five years.

Those contracts were won by TAG Offshore, each at $10,400/day. One AHT contract went to Greatship and another to GOL Offshore at $8280/day.