Companies

ONGC gets one year exemption from mandatory sourcing certain grades of seamless line pipes

Our Bureau New Delhi | Updated on November 26, 2019 Published on November 26, 2019

has been granted a one year exemption from mandatory local sourcing of certain grades of seamless line pipes.

The Grievance Committee on the Domestically Manufactured Iron and Steel Products (DMI&SP) Policy has ruled that domestic manufacturers are not able to supply seamless line pipes (for size 16 inches and below) according to ONGC specification 2020 A and 2020 B for submarine application.

ONGC had requested for an exemption from the DMI&SP Policy for these pipes for its offshore construction and pipeline projects. This relaxation was sought till the time Indian steel industries come up with the required facilities to cater to the manufacture and supply of required quality, grade, and quantity of steel and pipe and fabrication yards.

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The company had enjoyed a two year exemption from the mandatory local sourcing norm for this grade of seamless pipes that lapsed on September 14, 2019. ONGC has since requested the Steel Ministry to further extend the waiver for three years.

“The Grievance Committee recommends that exemption may be granted to ONGC for one year,” the decision of the grievance committee said. This exemption is subject to ONGC placing a development order on domestic manufacturers in a bid to encourage setting up the industry.

ONGC has also been directed by the Grievance Committee to aid the creation of Indian fabrication yards.

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“ONGC informed that they have encouraged Indian agencies like Lavgan Dockyard Pvt Ltd, (LDPL), Ratnagiri of Chowgule and Company Private Limited (CCPL) and Rohini Yard of Das Offshore, Mumbai to create fabrication yards in India as these agencies have shown interest in creating the fabrication yard. These yards have already been inspected and considered suitable on account of their access, sea front and water depth. Further, these yards have already been partially approved by ONGC,” the minutes of the meeting said.

ONGC’s fellow public sector undertaking, Oil India (OIL) has also been granted an exemption from mandatory local sourcing of steel products. But for OIL, it is a one time exemption for the procurement of Drill pipes with Pup joints by the company.

Published on November 26, 2019
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