Mazagon Dock pleads for ONGC's MNW contract

Vol 5, PW 22 (19 Dec 01) Exploration & Production

Influence and pressure to win contracts in India doesn't always work, as Mazagon Dock has just found out.

Mazagon - in an alliance with Hyundai Heavy Industries of South Korea - was one of 19 bidders to purchase tender documents for ONGC's $182m gas compression-water injection MNW project at Bombay High North and among the four shortlisted to submit tenders by the 31st August deadline. But ONGC refused to accept the consortium's proposal to have the Process Gas Compression Module built in Mazagon's yard by Hyundai, saying it violated the bid evaluation criteria.

Also, ONGC said Mazagon had not constructed process platform decks in the past 10 years and thus it did not find the offer technically acceptable. Mazagon didn't give up.

It wrote letters and arranged for meetings with ONGC, arguing that it met the criteria. PETROWATCH learns Mazagon termed ONGC's action "unreasonable".

Then deployed its ultimate weapon: a 13th September letter from the defence ministry to the oil ministry pleading its case. Again, ONGC refused to budge.

Finally, on 15th October Mazagon wrote to ONGC offering to construct the gas compression module in Hyundai's Ulsan yard on condition it could submit a revised price bid. ONGC was unmoved.

It ignored the plea, with a caustic comment that Mazagon "showed lack of business sense by not taking advantage of the opportunities offered to modify its bid earlier."

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