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Days after ONGC sought permission from the Steel Ministry for import of specialised casing pipes to continue drilling activities at Cauvery off-shore basin, an Indian company, Maharashtra Seamless — a DP Jindal Group arm — has written to the Ministry claiming that its tender for the said orders was unfairly rejected. The Gurgaon-based steel maker has also sought redressal from Ministry in this matter.
India has a public procurement policy in place where Indian companies or Make-in-India products are to be given preference in government projects. In absence of availability from Indian suppliers, specific permission from imports are granted.
According to a letter by Maharashtra Seamless, copy of which is with businessline, the company stated it is an “approved source” (supplier) of such specialised steel — called Q-125 casing pipes — and has been supplying to ONGC, OIL and other PSUs since 1992.
“… we would like to confirm that we are capable of manufacturing the above Q-125 casing pipes and wish to participate in the subject tender and in case of award of this contract to us we will supply the required Premium Connection Casing Pipes to ONGC for meeting their urgent requirement,” it noted.
The company claimed that its management has “invested significantly” on development of new products in India like drill pipe, oxygen cylinder pipe, sub-sea, low wall thickness, and so on. And 40-50 per cent of its existing capacity “is idle these days due to huge imports”.
Maharashtra Seamless has an installed capacity of 8.5 lakh tonne per annum to produce seamless pipes and tubes.
“…. so this order is very much important for us to utilise our idle capacity,” it mentioned in the letter adding that the company also has the requisite technical backing and tie-ups to go ahead with the manufacturing process.
The value of these orders, as per tender documents available, is close to ₹400 crore.
ONGC’s requirements include premium casing and accessories (of different specifications) worth ₹270 crore (and amounting to 15,656 tonnes in volume); casings with premium threads worth of ₹100 crore (1,860 tonnes in volume); and another set of specialised casings worth ₹15 crore. Officials said approvals are awaited across majority of the items.
Earlier this month businessline had reported that the Oil and Natural Gas Corporation Ltd (ONGC) wrote to the Steel Ministry expressing concerns over possible “idling of its rig” in the Cauvery off-shore in the absence of getting required casing pipes for drilling two ultra deep wells. It had said there are no Indian suppliers of the same. Accordingly, the country’s exploration and production giant had sought exemption from existing domestic sourcing norms.
“Non-availability of casings would lead to idling of the rig and other resources, which may result in heavy financial losses for ONGC,” the letter mentioned.
As per the letter, approvals were sought (across categories) in July 2022, December 2022 and then again March 2023. Earlier this year (in March and June) a Grievance Committee meeting chaired by a senior Steel Ministry official approved the proposals. “However, approval to procure the required casing pipes through ICB tender (international competitive bidding) is still awaited from the Ministry,” the letter said.
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