BHEL-Alstom, L&T-MHI in final round of NTPC tender

BHEL-Alstom and L&T-Mitsubishi Heavy Industry have made it to the final round of NTPC’s supercritical boiler tender, estimated at over Rs 10,000 crore. NTPC has set the deadline for bids to January 20.

A senior executive in one of the companies, requesting anonymity, said NTPC had issued letters to the BHEL and L&T-led consortia for the prestigious tender today. This was the second time that NTPC called for bids for the contract after L&T was disqualified on technical grounds in the first round.

L&T and BHEL were the only two qualified bidders in the first round. Bids from L&T Power, a 100 per cent subsidiary of L&T, was disqualified in June on the grounds that the company lacked experience to supply super critical boilers and lacked equity partnerships in manufacturing of boilers.

L&T’s joint ventures with a Japanese company – L&T MHI Boilers Pvt Ltd and L&T-MHI Turbine Generators Pvt Ltd – are between L&T and MHI, and not between L&T Power and MHI.

NTPC had issued a tender for bulk orders of supercritical power equipment with a cumulative generation capacity of 7,200 Mw. The tender had said that the bidder must have a manufacturing facility in India.

Though L&T had challenged its disqualification, the Supreme Court rejected its petition in October. The Delhi High Court had earlier rejected the company’s plea for staying the re-bid process. Besides formalising partnerships, the tender conditions also required the bidders to have acquired around 70 per cent of the land for putting up the manufacturing facility.

NTPC’s orders are for 11 boilers — nine for its own projects and two for the Damodar Valley Corporation. According to the tender, the lowest bidder for boilers would be given an order for six units. If BHEL is not the lowest bidder, the government will award the order for the remaining five units if it agrees to match the lowest bid. The option will be given to others, in case BHEL does not match the bid.

NTPC had floated the bulk tender for 660 Mw in October 2009. The last date for the submission of bids was January 28. Only BHEL and L&T had bid for the boilers but the boiler package was retendered in June. Besides L&T and BHEL, a consortium of Gammon-Ansaldo and BGR-Hitachi had also joined the fray.

The country’s biggest power generator had earlier selected a consortium of Bharat Forge-Alstom for the turbine and generator package of the bulk tender. Contracts for the boiler and turbine packages will be awarded simultaneously, said a NTPC official.

The government had last week approved another bulk tender for procuring nine supercritical units of 800 Mw capacity each.