List of Halliburton's complaints against ONGC

Vol 6, PW 6 (22 May 02) Exploration & Production

Halliburton's letter has an eight-page attachment with a long list of disagreements with ONGC.

Many of them will be familiar to other foreign oilfield service companies working in India. For instance Halliburton disagrees with ONGC's demand that it provide warranty cover ifits equipment is used with "non-standard" equipment from other companies.

Halliburton insists it will only provide warranty for its own equipment, "but if the components of its equipment are not compatible with those of any other company, Halliburton will be unable to provide any assurances on design and workmanship." Halliburton is astounded that ONGC wants protection from its insurance cover. "Nowhere in the world is Halliburton asked by customers for an insurance policy," writes the company.

"Halliburton cannot make available to ONGC its global insurance policy." More, Halliburton is critical of an ONGC practice of penalising contractors the full value of a contract even if 75% has been delivered. "It is normal for penalties to be imposed only on the undelivered portion," says the company.

Halliburton also complains that there is no cap on liability in ONGC's booklets on global contracts. According to Halliburton, ONGC has accepted this in several tenders during the past six months but is yet to make it law.

Halliburton wants total liability limited to $1m. And does not want suppliers to be held liable for "consequential, incidental, special, indirect or punitive damages, including but not limited to loss of profits or anticipated revenues." We could go on.