Surprise over ONGC choice of PMC for Cluster 2

Vol 22, PW 15 (16 May 19) Exploration & Production

More than two years after it began the process, ONGC has finally hired a project consultant to oversee the $5.06bn development of Cluster 2 at its flagship KG-DWN-98/2 deepwater block.

Yet many are surprised by an Executive Purchase Committee decision on May 1 to approve the contract award to a consortium of Bangalore-based Nauvata Engineering and UK-based CONSUB for approximately $35m - a fifth of ONGC's own budget of approximately $150m. "Such a low bid should have rung alarm bells at ONGC and been rejected," says a source.

He adds CONSUB is best known for its deepwater project expertise and its credentials are not in doubt but that it's a different story for Nauvata. "Forget deepwater experience," he says, "Nauvata doesn't even have near deepwater experience!" On its website Nauvata lists nine 'project references' as evidence of its track record.

Five are for ONGC off Mumbai where water depths are around 80 metres: three for the B-193 field development; one for the B-127 field pipelines; and one for the WO-16 field pipeline. Contrast that with Cluster 2 water depths of 850-1250 metres.

Of the other four projects, one is a crude oil pipeline off Kuwait, one involves 3D design for a FPSO and two are onshore tank projects. Some say Nauvata was chosen for its experience modifying ONGC's platform topsides.

"ONGC should only have hired CONSUB," says a source. "They have whatever experience is needed."