OGDCL to award $85m Uch project to firm against audit dept’s advice 

ISLAMABAD: In a move against its audit department’s advice, the Oil and Gas Development Company Limited (OGDCL) is all set to award an $85 million worth Uch Front End Compression Facility Project to a firm where high-ups are alleged to have personal links.

Profit has learnt that the tender for the UCH Front End Compression Facility Project was prepared to benefit an industrialist. They informed that the bid documents submitted by two bidders participating in the process are also identical.

According to a spokesman of OGDCL, the contract will be awarded on the basis of the most advantageous bid from technical and financial perspectives whereas the procurement process has been concluded strictly in accordance with the Public Procurement Regulatory Authority’s (PPRA) framework and the company’s procurement manual.

However, sources informed Profit that former General Manager (GM) OGDCL Imran Shoukat, through a WhatsApp text message sent in a group named OGDCL YOUNG GOLDIES, has already informed group members whom present Managing Director (MD) Syed Khalid Siraj Subhani will award the tender to before leaving office.

They further informed that the company’s audit department has recommended cancelling the tender as the criteria seems to be tailor made, bringing the competition down to only two bidders. In addition, both bidders are supplying equipment produced by a single manufacturer despite different vendors being available in the market.

It is relevant to note that the government had approved the appointment of Zahid Mir as MD OGDCL during the last week. Incumbent MD OGDCL Syed Khalid Siraj Subhani will surrender his seat after issuing a notification in this regard.

According to sources, former GM OGDCL, in an alleged connivance with the company’s officials, has been trying hard to ensure that the million dollar project is awarded to a firm of his choice despite the audit department’s opposition. 

They said that only two bidders, including Presson Descon Int, (Pvt.) Ltd. (PDIL) in a joint venture (JV) with Sui Northern Gas Pipelines Ltd. (SNGPL) and Hong Kong HuiHua Global Tech. Ltd. in a JV with a local company AJ Corporation, have participated in the bidding process for the Uch Front End Compression Facility Project. 

Profit has also learnt that a multinational company that manufactures similar material that is needed for the project has raised concerns regarding the bidding process. The said company has alleged that OGDCL’s bidding process for the procurement is suspicious and will cause a hefty loss worth billions to the national exchequer annually. In its complaint, the potential vendor has highlighted that it is rather strange  that the bidding competition policy of such a huge state-owned exploration and production giant is between only the two bidders. The vendor has claimed that there will be 20 to 30 per cent saving in the cost of the UCH project if OGDCL adopts a transparent method for awarding the contract.

As per OGDCL’s spokesperson, all procurement cases involving Rs50 million or above are sent for a pre-audit as a matter of standard practice and no exception was made in this case either. “An internal audit is an obligation wherein files are reviewed, clarifications sought and comments added. Thereafter, the concerned department and the Supply Chain Management address the queries or take remedial action if required,” he added.

The spokesman also said that the head of internal audit reports of the Board Audit Committee operates independently in the performance of his duties. He said the processing of a case within different sections of the company is purely an internal work flow arrangement. 

The fundamental question here is whether or not applicable processes and procedures have been followed in letter and spirit. Evidence shows that the determination of a successful bidder in this case was finalised without any deviation. According to the evaluation uploaded on the company’s website, the consortium comprising SNGPL and PDIL has emerged successful because it is technically qualified and offering the lowest bid,” the OGDCL spokesman claimed.