Greka yet to receive ONGC drilling contract
If London-listed Greka Drilling thinks ONGC is going to rush to award a contract to begin drilling development wells at the Bokaro CBM block in Jharkhand, it better think again.
An ONGC source at Bokaro or BK-CBM-2001/1 explains two major hurdles have to be cleared before the LoA can be issued to Greka, which announced it had emerged lowest bidder for the three-year contract on April 6. First ONGC's 20% partner at Bokaro, IndianOil, must approve Greka's appointment to drill 155 proposed development wells.
"When we have a financial implication we can't award a project to a service provider or a vendor without the approval of our partner," says an ONGC source. "IOC's consent is required." The second hurdle is that the CAPEX for the project has increased dramatically and needs to be approved by the ONGC board again.
"Our board cleared CAPEX of Rs823cr ($137m)," explains our ONGC source. "But the project cost has increased 20%.
We've written to our Board to approve the revised cost. That approval has yet to come.
The LoA will be issued after approval." Separately Kolkata-based Arihant Cargo Carriers says it has complained to the PMO against Greka, alleging that the company influenced ONGC to relax its bid evaluation criteria. "In its tender," says Arihant CEO Abhay Jain, "ONGC wanted to hire a mobile rig (mounted on a truck).
Greka doesn't have such rigs. ONGC must explain how it accepted Greka's bid."