ONGC poised to kick off tender for $500 million-plus offshore contract

Oil & Natural Gas Corporation (ONGC) is poised within weeks to issue bid documents for the eighth development phase of its Pipeline Replacement Project (PRP-8) offshore western India.

The Indian state-controlled company recently conducted a pre-bid meeting for PRP-8 and is expected to soon issue tenders to leading engineering, procurement, construction and installation players, three people familiar with the development told Upstream.

“PRP-8 tender is likely to be out soon and ONGC is expected to finalise its preferred contractor by August,” one person noted.

PRP is ONGC’s flagship offshore west coast project, with work usually performed every two years, aimed at boosting the pipeline infrastructure at some of India’s largest west coast fields.

PRP-8 could be potentially valued at upwards of $500 million and would involve the laying of almost 230 kilometres of subsea pipelines, a second person suggested.

Work on the PRP-8 project is likely to be carried out across two phases, with the first phase comprising the EPCI of 90 kilometres of pipelines to be executed during the field season starting in October.

In the second phase, close to 140 kilometres of pipelines are likely to be involved, with work likely to be carried out next year, Upstream has learned.

Three key west coast offshore assets are being targeted by ONGC — Mumbai High, Bassein & Satellite and the Neelam Heera — sources said.

ONGC’s west coast offshore fields are maturing and require several phases of redevelopment to maintain their production profile.

The contractors said to have shown initial interest in PRP-8 include Indian engineering giant Larsen & Toubro (L&T), Abu Dhabi’s National Petroleum Construction Company (NPCC), Australia’s Leighton and Nigeria’s Westfield Energy, project watchers said.

Multiple phases

ONGC has carried out seven expansion phases of the PRP over the past decade.

While L&T did not disclose the exact value of this contract, Upstream understands it could have been worth close to $500 million.

In 2019, Valentine Maritime won a contract for work on PRP’s sixth expansion phase, which was believed to be worth between $150 million and $170 million.

Malaysia’s Sapura won a subsea pipeline contract in 2018, comprising work on the fifth phase of PRP, also known as the subsea wells and pipeline replacement project (SSPRP-5).

In 2017, ONGC awarded L&T a $200 million contract for work on PRP-4, which was left unfinished by Singaporean contractor Swiber Offshore.

$7.3 billion investment push

The Indian giant plans to tender 18 sizeable offshore EPCI projects until 2025, involving a mix of brownfield and greenfield projects, Upstream has reported.

While 13 offshore projects worth $3.3 billion have been earmarked for the west coast region, an additional $4 billion is likely to be spent on five separate projects off the east coast.

India’s domestic crude production has been dwindling in recent years and ONGC is under increasing pressure from the government to boost its oil output and reverse the decline.

Western coast

In addition to PRP-8, some of the main projects being targeted by ONGC in the west coast region in the coming years are additional developments of the Ratna & R-Series and North Tapti fields, the Cluster 9 development, the B-193 phase two project, platform makeover projects and the MB0SN-2005/1 development.

Other smaller projects and developments involving India’s discovered small fields are also being targeted, Upstream understands.

The upcoming west coast projects are expected to involve at least 27 wellhead platforms and the laying of more than 1100 kilometres of subsea pipelines.

ONGC’s Daman upside project and the fifth phase of its Mumbai High redevelopment are also a part of its west coast development strategy, and the two projects have already been tendered by ONGC.