An Analysis of Petroleum Engineering Services Procurement by the Government Agencies in India

Introduction: With 1.4 Billion people, India is one of the largest consumers of oil and petroleum products. As of January 2024, 5329 thousand barrel of petrol is consumed in India each day! This number has grown considerably during the last decade. The country has 80238 petrol pumps, where people get their vehicles filled out with petrol. These petrol pumps are predominantly managed and operated by government agencies such as the Bharat Petroleum Corporation Limited and the Hindustan Petroleum Corporation Limited. A significant amount of effort and money is spent by these agencies to ensure smooth and safe transportation of petrol to the petrol pumps where they are ultimately consumed. For production, exploration, processing and delivering this fuel, these government agencies invest in hiring petroleum engineering experts. This article analyzes the oil and gas engineering tenders published by the government agencies in India during the last year. 

Annual assessment of tenders: A total of 972 petroleum engineering tenders were published during the last year. These tenders were published by 74 different agencies located across India. The top three buyers predictably are the Indian Oil Corporation Limited (IOCL), Hindustan Petroleum Corporation Limited (HPCL) and the Bharat Petroleum Corporation Limited (BPCL) with 373, 147 and 132 tenders respectively. Maharashtra was the top ranked State with 181 tenders, following by Uttar Pradesh with 81 and Gujarat and Delhi each with 73 tenders.  

LPG Plant tenders: Of the 972 tenders published during the last year, 286 pertained to LPG plant. Many different types of activities were undertaken related to the LPG plant. To mention a few: BPCL published a tender for ultrasonic scanning of steel plates and pipes including third party charges at the Palakkad LPG plant and Trivandrum LPG plant. The IOCL published a tender for statutory testing and painting of LPG bottling plant. Oil India Limited sought to hire an expert for certification by Competent Agency certified by PESO CCoE Witness the Testing of PSV SRV TSV with certification at LPG Recovery Plant. HPCL published a total of 30 tenders for mandatory testing of LPG cylinders, which is to be done in the Anantapur LPG plant. A tender was published by the BPCL for electrical safety audit of the LPG plant in Solapur. GAIL India sought to engage an expert to verify the integrity management system of LPG. Also, BPCL conducted external statutory pressure testing and painting of LPG cylinders. A few tenders were advertised to test the work execution in the LPG terminals. For example, Projects and Development India Limited published a tender for design and detailed engineering work for 2 nos double wall double integrated storage tanks at the LPG terminal in Mangalore. A few gas pipeline consulting tenders were published as well. 

Statutory testing in the Oil and Gas Industry

Given the flammable nature of the oil and gas industry, the government has laid down several statutory norms. The various government agencies involved in handling these petroleum products hire experts to verify compliance to the laid down statutory norms. Our study shows that 101 tenders were published for statutory testing. For example, it the Indian Oil Corporation Limited in Bihar announced a tender for statutory testing, inspection, cleaning, and certification of 3×600 MT mounded LPG storage bullets at Banka BP. Similarly, the Delhi Indian Oil Corporation Limited issued a notice for the statutory testing of 15 x 100 MT mounded storage vessels at the INDANE LPG bottling plant. The Indian Oil Corporation Limited in Tamil Nadu published an Expression of Interest for Statutory testing and painting (ST and P) of 5–10 years due LPG cylinders ex LPG Plant Salem BP. A Non Destruction Testing (NDT) tender was published by the IOCL for Statutory NDT Inspection Hydro Testing External painting and Certification of Horton spheres (2×1400 MT) at Devangunthi LPG Bottling plant Bangalore. 

Rate contract tenders for petroleum engineering services: In a few of the advertised tenders, the services providers were required to deliver the services on a rate contract basis. Among 972 tenders, 28 tenders were published for the rate contract for petroleum engineering services. For instance, Maharashtra Natural Gas Ltd. advertised a notice of rate contract for 2 years for the hiring of project management consultant services for steel pipeline laying and associated works for the CGD Network of Nanded and Nizamabad, GA. An annual service rate contract was published for the deputation of an expert service engineer of Ms. Minebea Intec India Pvt. Ltd. for troubleshooting and maintenance of the Silo Weighing System in the PP unit of Paradip Refinery by the Indian Oil Corporation Limited in Odisha. The IOCL sought to engage professionals for various activities such as surveying, TSS, soil investigation, structural designing, developing layout plans, construction drawings for various facilities. 

Budget estimate for tenders: The estimate value of the procurement was published in about 150 tenders. Most of these tenders were in the 10 Lakh – 50 Lakh range. However there were a few high value tenders such as the tender advertised by the Bridge and Roof Company (India) Limited in West Bengal  with an estimated value of Rs. 73.65 crores:  Fabrication, excavation, welding, testing, and commissioning of tankage work at the crude oil import terminal (COIT) project for NRL, Paradip. Another high value tender was published by the Indian Oil Corporation Limited in Kerala with a budget estimated at Rs. 49.83 crores for the statutory testing and painting of LPG cylinders. Besides, for the periodical audit of the electrical system of ROs, the Indian Oil Corporation Limited in Delhi was estimated Rs. 2.39 crore. 

Live tender analysis: As of 22nd April 2024, 31 tenders were published for bidding. In this, Haryana ranked at the top with 6 bids; subsequently, Maharashtra, Delhi, and Assam were at 5 each. Kerala at 4, Tamil Nadu and Uttar Pradesh at 3 each.

Conclusion: This analysis shows that the government agencies in India take secured handling of oil, gas and petroleum products seriously. Many different experts are hired to test the facilities used for processing petroleum products. Thos engaged in such work are advised to look for petroleum engineering opportunities and participate in them.