thyssenkrupp set to win 2 tenders

Vol 24, PW 19 (12 Aug 21) News in Brief

IndianOil is expected to begin negotiations with thyssenkrupp Industrial Solutions (tkIS) to beat down its prices after the German multinational bid lowest for two 'packages' under plans to raise Panipat refinery capacity from 15m t/y to 25m t/y and produce more petrochemicals by 2024.

When IOC opened price bids on July 31 (2021) for EPCM-2, tkIS bid lowest at Rs257.98cr ($36m), followed by Technip at Rs284.19cr ($40m), Engineers India (EIL) at Rs365.52cr ($52m) and Toyo Engineering at Rs453.86cr ($64m). Assuming it secures the LoA, tkIS will also project manage EPCM-2 work to set up a 2.5m t/y Indmax (Fluid Catalytic Cracker) unit, a 0.108m t/y LPG treater; a gasoline splitter unit and a motor spirit block consisting of a 0.83m t/y naphtha hydrotreater unit; a 0.624m t/y catalytic cracking reformer unit; and a 0.201m t/y isomerisation unit.

Also on July 31, tkIS bid lowest for the separate EPCM-3 package quoting Rs144.89cr ($20m). Next was Worley at Rs150.93cr ($21m) followed by EIL at Rs202.75cr ($28m).

As with EPCM-2, tkIS will project manage EPCM-3 to set up a 450,000 t/y polypropylene unit and a 0.56m t/y catalytic dewaxing unit. Most contractors are resigned to the inevitability that PSUs will try to beat down their price, despite Covid-induced economic hardship.

"This is a pattern with PSUs even though they know contractors are going through a tough time," we hear.