Swiber puts Indian contractors last for payment

Vol 20, PW 7 (15 Dec 16) People & Policy
     

Around 100 local sub-contractors hired by Swiber in India are worried sick they might not recover a total $63.7m in outstanding payments after the financially stricken Singapore company told the Mumbai High Court on November 30 it can't continue with three unfinished ONGC projects.

Swiber lawyers admitted this to Justices VM Kanade and Nutan Sardessai after ONGC told the court the same day that Swiber cannot "perform" or complete its contracts. Swiber gave no reason for its decision but sub-contractors have asked the court to clarify how Swiber has used $471m that ONGC has paid it so far for the incomplete Daman, PRP-IV and C-26 projects off Mumbai? Indian subcontractors are also demanding a $9m deposit ONGC earlier gave to the court on October 27, the same day it paid Swiber a separate $11m mostly to settle payments to overseas subcontractors: $5.9m went to PetroVietnam and $3m to PT Gunanusa; another $1.55m went to Indian income tax authorities and $610,000 went to ICICI Lombard Insurance.

Most worrying for Indian subcontractors is a court clarification on November 23 that ONGC is at complete liberty to terminate its unfinished Swiber contracts. They suspect a plot by ONGC and Swiber to prevent them from receiving the money they're owed.

Equally upsetting was Justice SJ Kathawala's October 7 order allowing ONGC to release $21m to Swiber for payments - but only to overseas sub-contractors, not Indian.

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