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ONGC OSV

November 9, 2009

Pipavav signs OSV design contract with Wärtsilä

Wärtsilä has signed a ship design contract with Pipavav Shipyard of India. The contract calls for a total of 12 Offshore Supply Vessels (OSVs) to be designed by Wärtsilä and built by Pipavav, for delivery to ONGC--Oil and Natural Gas Corporation Ltd, which is the largest oil and gas producer in India. The yard is scheduled to begin production of the first seven vessels in the first quarter of 2010.

The contract is Pipavav's first for OSV's. According to Indian financial website Livemint.com it is worth $112 million. Pipavav won the job in a second round of bidding. In the first round of bidding in March, ONGC received a lowest price of $16.7 million for each vessel. At that price, the contract would have been worth $200.4 million. In the second round in May, says Livemint, ONG asked for revised quotations from the shortlisted firms to take advantage of the fall in ship prices globally and Pipavav won with a bid of $112 million for the 12 vessels.

ONGC originally invited participation from ship designers and shipyards worldwide for its pre-qualifying tender. Of the six shipyards subsequently shortlisted, four of the tenders submitted were based upon Wärtsilä designs. Pipavav Shipyard worked closely with Wärtsilä Ship Design throughout the tendering process.

Building of the vessels is to be completed within 30 months.

The 59 m vessels are designed to achieve a speed exceeding 12.5 knots, and will provide back-up for search, rescue and standby support. They will also transport cargo between ONGC's supply base and its offshore installations.


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