A "Class 1 local supplier", or a supplier that has 50% or more local content in goods and services, will receive purchase preferences for government procurement.
New Delhi (Natural Energy News): At a time when the country's oil and gas sector is executing projects worth about Rs 5.88 lakh crore, the central government has revised the purchase-preference-local-material (PPLC) policy for the sector. To promote domestic manufacturing, the new policy allows bidders using local products to win contracts even if they bid 20% above the minimum bid. The purchase preference margin was previously kept at 10%.
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The policy will be applicable for all tender issues by public sector oil and gas companies and their joint ventures.
A "Class 1 local supplier", or a supplier that has 50% or more local content in goods and services, will receive purchase preferences for government procurement. For the purchase of goods or services where there is sufficient local supply capacity, only Class 1 suppliers will be allowed to participate in the auction, the revised policy note issued by the Ministry of Petroleum and Natural Gas stated.
The revised PPLC policy also states that if a foreign government does not allow any Indian supplier in its country to participate in the auction, the ministry may exclude bidders from that country from participating in the auction in India. . CPSEs are currently running more than 8,000 oil and gas projects including refineries, exploration and production, pipelines, city gas distribution, drilling and survey activities. The total estimated cost on these projects is Rs 5.88 crore, with a target of Rs 1.2 lakh crore as capital expenditure for FY 2015.
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Major oil and gas activities to be executed so far include HPCL's Rajasthan Refinery worth Rs 43,129 crore, HPCL's Visakh Refinery Modernization at Rs 26,264 crore, HPCL-Mittal Energy's Rs 22,900 crore Polydition Project and IOCL's Rs 14,810 crore refinery capacity The expansion project is included.
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