Financial Daily from THE HINDU group of publications
Tuesday, Jul 19, 2005
Financial Daily from THE HINDU group of publications Tuesday, Jul 19, 2005 |
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Corporate
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Announcements Industry & Economy - Power Dabhol LNG terminal: GAIL reconstitutes original consortia Our Bureau
New Delhi , July 18 GAIL (India) Ltd today said that it has managed to reconstitute the original engineering procurement and construction (EPC) consortia to enable early completion of the Dabhol LNG terminal. Originally, Lingtec, which was an Enron affiliate, was awarded the main EPC contract for constructing the LNG terminal along with the marine facilities. Lingtec, in turn, had awarded two EPC sub-contracts. The first one pertaining to the re-gasification, tankage and utilities at the LNG terminal was awarded to a consortium comprising Kvaerner and Whessoe, both of UK, and Punj Lloyd Ltd. The second contract pertaining to the marine facilities comprising the jetty, approach channel and breakwater was awarded to a consortium of Besix of Belgium and Kier of UK. About 75 per cent of work was over before the construction activities were stopped. Further, the absence of engineering database of the project and the issues related to the ownership of the Intellectual Property Rights of the technical documentation of the project were major bottlenecks in restarting the construction activities. "With the reconstitution of the consortia, these problems have been solved to a large extent," the company stated. Commenting on the rationale behind the reconstitution of the consortia, GAIL said, in view of many new build opportunities for LNG terminal projects, EPC contractors do not feel inclined to undertake abandoned jobs lying idle for four years and also guarantee the performance of the same. Hence, erstwhile contractors are best suited to pick up the threads and complete the job, the company added. The terminal contractors are generally satisfied with the state of preservation of the facilities and the remaining work is targeted to be over by July 2006. The consortia would undertake completion of the balance works under the active supervision of two project management consultants being engaged in this regard, GAIL said. NTPC is also roping in GE for the completion of the power plant facilities. The construction of the LNG terminal was abandoned in June 2001, when the Dabhol project ran into contractual problems. Thereafter the Indian lenders had engaged Tractebel of Belgium to assess the condition of the facilities and develop a preservation regime for the entire project. In April 2002, Punj Lloyd Ltd was engaged to undertake preservation of the project facilities and since then the arrangement is continuing.
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