Indian Oil receives two bids for green hydrogen plant

16 Jul 2024 , 01:03 PM

According to news reports, Indian Oil Corp (IOC) only got two bids to construct the nation’s first green hydrogen facility at its Panipat refinery in Haryana. This is in reaction to the project’s second tender, the first of which was discarded due to claims of preferential treatment.

A joint company held equally by IOC, ReNew, and engineering major Larsen & Toubro is one of the two bidders, GH4India. In FY23, GH4India was established with the goal of developing green hydrogen and its byproducts, such as green methanol and ammonia, in addition to production and related renewable resources.

Neometrix Engineering, a Noida-based company that specializes in turnkey projects involving gas handling and boosting systems, special purpose machines, and other equipment, is the second bidder. For IOC, it has carried out several EPC projects.

The IOC tender is the first attempt in India to use a bidding or market-driven process to establish the price of green hydrogen.

However, in a recurrence of last year’s events that resulted in the cancellation of a contract for the same project, some of the biggest names in industrial gases and engineering have refrained from participating in the pre-bid meeting, after previously expressing interest.

The bidders have been given time to submit their offers during this second round of tendering, IOC informed. The refiner responded to questions of ET by saying, “The tender was extended a number of times to facilitate bidding.”

Four months in all were given to the bidders. Over the course of four months, several rounds of interaction were conducted with the potential bidders. The received offers are currently undergoing technical review. Following the completion of the evaluation process, other comments may be made.” In March, the updated bid document was released.

According to the reports, around thirty entities obtained the pre-bid materials in May. They included multinational behemoths like Siemens, Petronas/Gentari, Linde, Matheson, and EDF, as well as indigenous firms like InoxAir Products, Acme, Tata Projects, KEC Ltd, Afcons Infrastructure, Thermax, AM Green/Greenko, and the state-owned NTPC.

Rivals are challenging the eligibility requirements this time around in relation to prior experience managing hydrogen systems, electrolysers, and EPCs. According to the report, a qualified bidder must meet the technical requirements, which include having EPC expertise and running a refinery, petrochemical, or fertilizer facility for a minimum of 12 months.

One of the authorities who assessed the offer stated to ET, “There is only one industry consortium that is a refiner and also an EPC player and has renewable energy experience, and that is the GH4India consortium where the procurer himself is a 33.4% shareholder.”

Since there are so few companies with the scale and experience necessary to be eligible, some of the potential bidders requested an extension of the deadline for forming comparable joint ventures with industrial gas producers. For instance, Air Products and Inox Air already have a joint venture. Although French company Air Liquide does not yet have a significant presence in the industrial gas arena, Germany’s Linde India affiliate (previously BOC India) has been operating in the country for 80 years.

The right of first refusal clause included in the tender notice was the primary source of contention in the first attempt. Because a public sector undertaking (IOC) was supporting a public-private joint venture to have the first right of refusal, bidders claimed that this clause violated public procurement regulations.

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