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OGDCL allegedly awards purchase order to a Chinese company without publishing tender, pre-qualifying companies

OGDCL allegedly awards purchase order to a Chinese company without publishing tender, pre-qualifying companies

ISLAMABAD: Oil and Gas Development Company Limited (OGDCL) has awarded USD $5,600,000 worth contract to a Chinese company CNPC (Chuanqinq Drilling Engineering Company Ltd.) for hiring of rigs allegedly in violation of PPRA rules, said sources.

Surprisingly, recently OGDCL top management has been appearing in National Accountability Bureau (NAB) to clear their position in various inquiries/investigations initiated by corruption watchdog (NAB) after receiving complaints. Similarly, dozens of corruption cases of OGDCL are under investigation with Federal Investigation Agency (FIA). However, it appeared that OGDCL management has been leaving no stone unturned to avoid compromise on concerned rules while dealing with business related matters, and company’s performance/targets.

Sources in OGDCL informed that CNPC had allegedly influenced the board and the management of OGDDCL seeking approval for hiring of its one rig. And, the OGDCL had awarded approval in this regard in February 2019 through a limited/negotiated tender, which was not published in the international newspapers. They said that OGDCL  had sent CNPC a limited tender for procurement of two (02) rental rigs and this tender was only sent to CNPC and Deutag Drilling, while approval was given to CNPC only and Deutag was declared technically disqualified. They said CNPC  was awarded this tender on higher rates as compared to the rates which were previously offered by CNPC in OGDCL tender number 2020.

They said the cost of this purchase order/contract awarded to CNPC was USD $5,600,000, which was granted without initiating even a process of pre-qualifying the companies by OGDCL. As per PPRA rules, OGDCL cannot send limited/negotiated tenders without initiating a process of prequalifying companies while a tender with same value should be published in international newspapers, said sources.

Sharing details of alleged award of USD $5,600,000 worth contract for hiring of rigs, sources said that due to slow drilling operations, OGDCL’s Drilling Department had raised the need of three more rigs before OGDCL management for drilling/spudding of wells to meet target till June 2019.

Available documents with Customs  Today said that OGDCL tender # 2020 was published in 2017 and OGDCL received offers from the rig contractors. The scope of work was to supply six (06) drilling rigs-2000hp for onshore drilling and all services were inclusive, while the projected wells had to be spudded either in the 4th quarter of 2016-2017 or by 1st quarter 2018-2019. And, in this contract three (03) rigs were provided by CNPC (Chuanqinq Drilling Engineering Company Ltd.), a Chinese origin drilling company based in Islamabad-Pakistan. The value of this contract was USD$ 22,968,209.48, while duration of the contract was one (01) year expired on 30th June 2018.

Sources said that CNPC had allegedly tried to influence OGDCL Drilling Department for mobilization of its rigs by getting an extension for OGDCL tender # 2020 at the end of this contract term. However, they said OGDCL’s departments like SCM (Supply Chain Management, Audit etc) other than Drilling Department had opposed to grant CNPC extension. And, extension at that time was not given to CNPC as new tender number 3229 was published by OGDCL for rental of six rigs in 2018. As a result to this, nine (09) bids were received and six lowest financial contractors were given the purchase order and SENOPAC and HIGH Long etc. were among these companies. CNPC offer was rejected being highest          and OGDCL awarded contract to the other bidders who were technically qualified and being lowest in commercial terms as per the PPRA rule, said sources.

Sources were of the opinion that because CNPC did not win this tender and its rigs were going to be demobilized so the company (CNPC) had allegedly tried to use its influence in drilling department once again to get this tender cancelled and also for securing extension to previous tender (tender number 2020). But, due to OGDCL department’s opposition for awarding extension to a tender previously won by CNPC, new tender number 3229 was not cancelled and extension at that time was also not given to CNPC, said sources.

Sources also said that CNPC had allegedly used its influence in OGDCL again and got delayed the tender (tender#3229) while due to delays in performing OGDCL drilling schedule as per original projection, up till now only seven (07) wells are drilled while only three (03) months are left to complete well drilling target till June 30 and OGDCL  projection for this year till June was 27 wells. They said CNPC had used Drilling Departments to put pressure on the SCM and other departments to get favors and allegedly AGM Drilling and Atizaz (Manager) were the main instrumentals for such maneuvering in favor of CNPC.

It is also learnt from sources that AGM Drilling had served on one rig and during last fiscal year, and it was found unable to complete well drilling target of 2018.

“A similar case of rigs is under investigation with FIA and AGM Drilling is also accused in that case as well.”

It is relevant to note that AGM Drilling Operations was contacted many times through text message and phone calls on his cell phone number. But, all efforts remained in vain as he did not respond.