Hardy and HOEC in helicopter row with ONGC

Vol 14, PW 21 (21 Apr 11) Exploration & Production

ONGC is furious with UK-listed Hardy Oil & Gas and Eni-subsidiary HOEC over plans to share a single helicopter between the PY-3 oilfield and the PY-1 gasfield offshore Tamil Nadu.

PETROWATCH learns ONGC sent Hardy a strongly worded letter on March 11, accusing it and HOEC of pushing up OPEX costs at PY-3 with their helicopter pooling deal. In May last year DGH and oil ministry officials asked Hardy and HOEC to consider pooling helicopter services to reduce overall OPEX.

Hardy and HOEC floated a tender late last year to hire a single helicopter for both fields but received no bids, as they were strangely asking for a helicopter with an ‘anti-collision device’. “Such devices are fitted only on helicopters used to transport the US President!” says an incredulous industry source.

He adds that Hardy and HOEC finally extended an old PY-1 helicopter contract for five months from February 1, 2011. Oddly, they chose to have the helicopter operate from a base at Chennai instead of a base at Puducherry, as ONGC would have liked: the flight time from Puducherry to the PY-3 platform is just 15 minutes, but from Chennai it is 55 minutes.

ONGC’s angry March 11 letter to Hardy reads: “We are distressed to note that while a tender has been invited by HOEC with certain equipment specifications (which no bidder could offer) the entire objective apparently has been to extend the present (PY-1) helicopter contract as worked out between the two operators without approval of partners with regard to additional cost savings which could have accrued by shifting the operational base (from Chennai to Puducherry) and getting competitive bids through tendering.” Operator Hardy (18%) shares PY-3 with ONGC (40%), HOEC (21%) and Tata Petrodyne (21%).

HOEC operates PY-1 with a 100% stake.