'Don't rush 98/2 development!' warn contractors

Vol 20, PW 1 (22 Sep 16) Exploration & Production

ONGC often stands accused of moving too slowly but on this occasion contractors fear it is moving too quickly in a $2bn tender to install subsea facilities at eastern offshore deepwater block KG-DWN-98/2.

At an August 23 meeting in Hyderabad for the combined Subsea Production System (SPS) and Subsea Umbilicals, Risers and Flowlines (SURF) project - with a new SPURF acronym - ONGC said the tender will be out late September or early October and that bids must be in by end-December or early January. Everyone present asked for more time, among them GE partnering McDermott, Technip with FMC, Subsea 7 with OneSubsea, Aker Kvaerner with Saipem and SapuraKencana with Dril-Quip.

Likely bidders are worried ONGC plans to provide them only with a pre-FEED from WorleyParsons subsidiary INTECSEA. "How can we prepare bids properly unless we have a proper FEED?" asks one frustrated potential bidder.

But ONGC's team led by executive director Alok Nandan stood firm saying three months is more than enough to prepare bids and that the pre-FEED is an "advanced document" that makes a fresh FEED unnecessary. Why is ONGC in such a rush? Some speculate it's because managing director DK Sarraf and director offshore TK Sengupta want to award this contract before they retire in 2017 to showcase 98/2 development as 'their achievement'.

More likely is that ONGC is under pressure from the oil ministry to bring the long delayed development on stream fast.

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