Dark days for Indian Oiltanking's EPC division
Two years after shutting its seismic business, Indo-German joint venture IOT Energy and Infrastructure services seems to be winding down its EPC division, according to well-placed sources.
"IOT last bid for an EPC project in December 2015 when it tried for the coke drum structure package tender at (parent company) IndianOil's Haldia refinery," says a source, close to IOT. "L&T won that tender." He claims the EPC division of this JV between IOC and Germany's Oiltanking has now reduced to 40 staff compared to nearly 300 about 18 months ago.
He further claims the company's EPC, tank farm and operation and maintenance business has seen annual turnover drop sharply from around Rs3000cr ($471m) four years ago to just Rs250cr ($39m) today. Worse, IOT has even stopped bidding for projects where it was qualified, like the off sites and utilities contract at IOC's Bongaigaon refinery, tank farms at IndianOil's Paradip refinery and a HPCL tender to set up additional tanks at its Mumbai refinery.
What explains IOT's decision to wind down it's EPC division? Industry sources blame it on German parent company Oiltanking losing interest in the "loss-making" EPC sector about a year ago. This culminated in the resignation on July 6 (last month) of IOT's EPC group president Ashwini Kumar.
Before Kumar, contracts division head Shekhar Agashe, IT head Ritesh Verma and CFO Raj Mundra quit in June. Quality head Partha Sengupta quit on July 8.
