Hyundai and McDermott favourite for Neelam EPC

Vol 20, PW 2 (06 Oct 16) Exploration & Production

Hyundai Heavy Industries (HHI), the world's largest shipbuilder, and US-based EPC giant McDermott are expected to dominate the race in ONGC's re-tendered Neelam redevelopment project.

An industry source reports that ONGC has persuaded Hyundai to bid in the tender (re-issued on September 23) to increase competition. Hyundai last bid in an ONGC tender three years ago but was unsuccessful and has stayed away since fearing cut-throat rates from local Indian companies L&T, Punj Lloyd and Essar.

The South Korean company last won an ONGC offshore EPC contract in October 2003 when it walked away with a $222m contract for the offshore Mumbai South Platform. Some say Hyundai is so disillusioned with the Indian market that it was preparing to close down its offshore EPC business when ONGC convinced it to try for the Neelam project.

"To be cost-effective Hyundai must find a local partner to manufacture the (Neelam) platforms," says a source. Also expected to stand a good chance is McDermott - brimming with confidence after winning a $366m ONGC contract in December 2015 with L&T: the eastern offshore deepwater Vashistha S1 subsea facilities installation project.

According to tender documents, the pre-bid is scheduled for October 21 with bids due by December 19. ONGC hopes to issue the LoA by March 2017 and wants the project completed by April 30, 2019.