IndianOil moves fast on Vadinar SPM project

Vol 24, PW 15 (17 Jun 21) Midstream, Downstream, Renewables

Despite earlier setbacks, IndianOil is determined to award a contract to install a new Single Point Mooring System (SPM) with pipelines off Vadinar in Gujarat soon.

IOC has informally told bidders it wants to award the project by June 20 (2021), so whoever wins can complete and commission it by May 31 (2022) when the 'fair weather' window ends in the western offshore before the four-month monsoon season begins. Leighton India, Sapura Offshore, Valentine Maritime Gulf, and newcomer Van Oord all bid by the extended May 20 (2021) deadline.

Estimated to be worth between $90m and $100m, this is the second time IndianOil is tendering for an SPM at Vadinar, designed to ensure it can import additional oil for its Koyali refinery, which it is expanding from 13.6m t/y to 18m t/y. IOC has promised to hand over the pipes, the SPM unit, the subsea Pipeline End Manifold (PLEM) and other equipment for the project in January (2022) so the successful bidder can complete the project by May 31 (2022).

Bidders are happy IOC's present SPM tender offers up to 5% of the contract value as a financial incentive for early completion. "These incentives are available weekly up to a maximum 5% of the contract value," says a bidder.

He adds this shows IOC accepted bidder concerns during the April 29 pre-bid that it had not extended the project completion schedule despite scrapping the original tender on March 30 (2021). Some say Dutch family-owned contractor Van Oord risks disqualification for refusing to withdraw 'deviations and exceptions' from its bid.

Van Oord supporters say it is just following tender terms, which allow bidders to submit deviations and exceptions.