ONGC Clarifies Cancellation of Jack-Up Rig Tender, Cites Concerns Over Pricing and Bid Patterns – Indian PSU
Oil and Natural Gas Corporation Limited (ONGC), has issued a clarification regarding the cancellation of its recent tender for hiring jack-up rigs, following a report published in certain sections of the media.
In its statement, ONGC emphasized that all procurement activities are conducted in strict adherence to established public procurement principles, ensuring transparency, fairness, and healthy competition. The PSU reiterated its expectation that all bidders engage in fair practices and submit genuinely competitive bids, while avoiding any form of unfair trade behavior such as predatory pricing, collusive bidding, or coordinated market manipulation.
According to ONGC, the decision to cancel the tender was based on concerns arising during the bid evaluation process. The company observed a sharp escalation of nearly 60% in pricing—from a day rate of USD 35,606 to USD 56,195—within a span of approximately nine months. Such a steep increase was deemed significantly beyond reasonable market trends.
ONGC noted that when this pricing surge was assessed alongside the overall bid patterns and prevailing global market conditions, it raised legitimate concerns about potential collusive practices among bidders. As a responsible public sector procurer, the company stated it was obligated to closely examine these irregularities, ultimately leading to the cancellation of the tender.
The PSU further clarified that its decision was driven solely by the need to safeguard organizational interests, ensure prudent utilization of public funds, and uphold the integrity of the procurement process. It stressed that no extraneous factors influenced the decision.
Reaffirming its commitment to transparency and industry engagement, ONGC encouraged all prospective bidders to participate in a fair and competitive manner. The company also underscored its resolve to prevent cartelization and maintain the credibility of its procurement systems.
