RIGS: Anger as ONGC prepares to hire 7 rigs

Vol 18, PW 15 (26 Mar 15) Exploration & Production

ONGC is under fire for trying to bypass the tender process in hiring seven jack-ups to allegedly help favourite contractors through the "backdoor."

PETROWATCH learns ONGC's Executive Purchase Committee (EPC) originally planned to discuss the proposal to hire the jack-ups without tender on a nomination basis at its meeting on March 17 but is now planning to discuss the matter at the next EPC meeting. ONGC wants to hire rigs to each drill a single well at Mumbai High over the rainy monsoon season from May 15, 2015 to September 15, 2015.

"Why can't ONGC issue tenders?" questions a drilling contractor. ONGC, he adds, is likely to re-hire at least three jack-ups already on contracts ending in April and May this year.

Shelf Drilling is hoping to win nomination contracts for CE Thornton and FG McClintock, both coming off their $91,549/day three-year contracts on May 1, 2015. Aban Offshore is also hoping to win a short-term contract for Aban-II coming off its $51,405/day three-year contract on April 18, 2015.

Jagson Drilling is hoping to win a short-term contract for Deepsea Matdrill and Deepsea Treasure, both idle in Indian waters. "Deepsea Treasure has been idling for more than three years and can't be offered in ONGC tenders," adds a driller.

"Jagson is hoping for a nomination contract."

ï»¿Jindal Drilling is also hoping to win work for new-build Jindal Pioneer and Jindal Explorer. ONGC's last rig tender was in January 2014 for 12 jack-ups where it awarded LoAs for eight leaving a shortfall of four . "ONGC's executive committee approved hiring seven jack-ups on February 3," we hear. "Before that the EC approved the hiring of eight offshore rigs in January. But no tender was issued." When contacted, ONGC defends its decision to "extend" contracts of rigs already in the Mumbai High during the monsoon. "We save on mob and de-mob costs," we are told. He adds drillers who get short-term contracts by nomination submit an undertaking to match the lowest rates quoted when a tender is issued. Separately, on January 29, Jindal filed a case against ONGC in the Delhi High Court for planning a fresh jack-up tender. ONGC assured the court it would issue no further jack-up tenders before March 15.

RIGS: Anger as ONGC prepares to hire 7 rigs

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