ONGC conducts GST session for 19 global contractors for offshore engineering projects


Keeping with its dynamic approach, Oil and National Gas Corporation Limited (ONGC) pro-actively took up the cause of providing clarity on the vexed issues of newly introduced Goods and Sales Tax (GST) and its operative part. Offshore Engineering Services (OES) Mumbai successfully organised an Open Interactive session with Lump Sum Turn Key (LSTK) contractor of OES on GST on 20 July 2017 at 1st Floor, auditorium, 11 High, Mumbai.


The session was chaired by Executive Director, Chief of Engineering Services – A. Ravi and supported by P.K. Saxena, Group General Manager-Head Of Department; S.C. Pandey, Group General Manager – Head of Works (HOW);  D.S. Sagar, Group General Manager (F&A) and General Manager (MM)  B. Rajendran.


The need to take up this initiative surfaced when LSTK bidders expressed their concern about understanding of some of the nuances of GST and their implications on the bid for these upcoming tenders worth over a billion dollars. As these tenders are directly related with enhancement and maintenance of oil and gas production from Western Offshore Fields, it was utmost important for OES to understand the concern of these bidders and address them suitably. These projects are being monitored by the Ministry of Petroleum and Natural Gas on a regular basis.


International bidders like NPCC of Abu Dhabi, Vietsopetro of Vietnam, Sapura Kenccana of Malaysia CUEL of Thailand, Pt Timas of Indonesia raised various queries on GST that helped to meet the tendering and completion schedule of the tenders.


OES Mumbai took this initiative and identified the clauses which have impacted the implementation of GST like Instruction to Bidders, General Conditions of Contract, Price Schedule, Milestone Formula.


Meanwhile, based on request of OES, Chief Corporate Finance engaged outside tax consultant for better understanding on the issues of interface of GST and Customs duty so that the bidders do not load the bid due to their unclear understanding on GST. All related clauses and clarifications are incorporated for the highest priority tender of OES, Mumbai i.e. Daman Transportation and installation tender and after incorporation of changes, bidders were to submit their bid.