ONGC Opens Tender Race for Giant Platform
Friday 2 December 2016
INDIA’S Oil & Natural Gas Corporation (ONGC) has issued a much-awaited tender for a huge processing platform and associated facilities required for its $5 billion-plus KG-DWN-98/2 deep-water development, off India’s east coast.
Industry sources stated that ONGC issued the tender for the process platform job last week and technical and commercial offers are expected to be submitted by February next year.
Leading domestic and international contractors are said to be lining up for the offshore project, which is expected to involve structures weighing more than 40,000 tonnes combined and could be valued at more than $600 million, according to industry sources.
Those that responded to an expression of interest floated in October include domestic engineering giant Larsen & Toubro (L&T), fellow Indian player Afcons, French major Technip, Italy’s Saipem, US giant Mcdermott and Abu Dhabi-based National Petroleum & Construction Company (NPCC).
Also included are Vietnam’s Petrovietnam Technical Services Corporation (PTSC), China’s Offshore Oil Engineering Company (COOEC), United Arab Emirates-based yard Lamprell, Malaysia’s SapuraKencana and MMHE, Singapore’s Sembcorp Marine and South Korea’s Daewoo Shipbuilding & Marine Engineering Company.
Industry sources said that while the list of interested parties stands at more than a dozen they expect that this will be reduced to around four or five serious contenders or consortia that will eventually submit bids.
“We are hoping that there will be four to five bidders or even more. Quite a few contractors are expected to form consortia, since that would reduce the risks associated with the project,” one source suggested.
For example, industry talk suggested that McDermott could join with L&T and Afcons may team up with PTSC. A second source suggested that Saipem might form a consortium with SapuraKencana, and Technip could be associated with Malaysia’s MMHE, though this could not be confirmed by other players.
COOEC is also expected to participate even though Chinese contractors have so far had limited success in winning work in India. It is aware of the challenges but with apparent encouragement from ONGC is ready to chase a share of the spoils, a source said.
Some industry sources suggested that with the process still at a relatively early stage consortia are yet to be firmed up.
“There are lot of contractors trying to form consortia and exploring their options, whether to bid or not. We should have more clarity in another two to three weeks,” he said.
Another source added that some South-East Asian or other international yards that did not respond to ONGC’s earlier expressions of interest offer could yet team up with other players. “It’s an open tender and anyone can participate, even if they did not respond to the earlier offer,” he said.
The project’s workscope centres on a central processing platform that will be bridge linked to a living quarters and utilities platform to provide gas handling capacity of 12.75 million cubic metres per day.
A 75 metre-long interconnecting bridge is expected to run from the CPP to the LQUP, added sources.
Sources have said that the main CPP topsides is expected to weigh about 18,298 tonnes, supported by an eight-legged jacket of about 10,530 tonnes. The CPP will be installed in water depths of 90 metres.
The living quarters and utility platform will have a topsides of about 6118 tonnes and a four-legged jacket of 3562 tonnes, claimed sources.
Sources have suggested that the job is likely to be challenging and leading domestic yards are unlikely to be able to fabricate the CPP topsides in India.
“We don’t think that the Indian yards are capable of loading out the CPP topsides from their facilities. This would mostly likely be done by international yards,” one said.
The project’s workscope is being seen as potentially big enough to attract the likes of South Korean giants Hyundai Heavy Industries, Samsung Heavy Industries and Daewoo.
However, some industry insiders doubt that the South Korean players will bid, even though Daewoo participated in the expressions of interest process.
“We don’t see the South Koreans bidding at this stage, but we need to wait for a few more weeks to have more clarity,” one source said.
The engineering. procurement and construction project is expected to be awarded next year and ONGC is targeting a completion deadline of mid-2019, which is said to be quite “aggressive”.
ONGC is moving ahead swiftly with its $5 billion-plus development of the KG-DWN-98/2 deep-water asset on the east coast.
Several expressions of interest have recently been offered by the Indian giant and most of the tenders are expected to be floated by the end of this yeat.
The present development phase relates to Cluster 2 in the northern discovery area of KG-DWN-98/2.