L&T determined to win PRP-7 project from ONGC

Vol 23, PW 15 (04 Jun 20) Exploration & Production

Larsen & Toubro is showing its hunger for work by 'unconditionally' accepting ONGC's postponement of the LoA date for Pipeline Replacement Project-7 or PRP-7 offshore Mumbai.

Along with Abu Dhabi-based NPCC and Malaysian contractor Sapura Energy, L&T bid by the extended March 19 deadline for an estimated $350-$400m contract to replace old subsea pipelines off Mumbai. Interestingly, only L&T has unconditionally accepted ONGC's extension of the LoA date from May 16 to July 16 (2020) even though ONGC is making no effort to simultaneously extend the work completion deadline beyond May 15 (2022).

In stark contrast, NPCC and Sapura accepted the LoA extension, but only on the condition that ONGC extends the completion schedules. ONGC would normally disqualify bidders who refuse 'unconditionally' to accept its terms.

"This (PRP-7) is a more complex job than earlier projects," says an industry source. "No vendor is willing to commit to timelines; it is unfair of ONGC to extend its LoA date using Covid-19 as a pretext and not make an allowance for bidders when it knows the pandemic is disrupting the global economy."

ONGC is thinking of allowing PRP-7 bidders to move some work scheduled in the first season to the second but director offshore Rajesh Kakkar is yet to formally approve. "That won't be enough," says a bidder.

"The entire project completion schedule must be extended."