KPPU Investigates Chevron?s IDD tender

Competition watchdog KPPU is investigating FEED tender held by Indonesian unit of US energy and Chevron Corp. for its deep water gas project called Indonesia Deepwater Development (IDD) offshore East Kalimantan.

KPPU chairman Nawir Messi was quoted by Koran tempo as saying that said there was a report of collusion between Chevron and participants of the tender for the project: PT Technip Indonesia, PT Worley Parsons Indonesia and PT Singgar Mulia.

First indication is Technip was named as winner for floating production unit (FPU) FEED although it proposed US$27 million for the project, far higher than Worley which bid for $20 million. Second, Worley was named the winner of subsea pipeline project and export pipeline FEED, although it proposed $3.5 million for the latter, or higher than contender Wood Groups with $2.6 million.

Third, for the receiving terminal, Singgar Mulia was named the winner with $2.5 million proposal, although Worley proposed $2.2 million.

Chevron spokesman Yanto Sianipar denied the collusion, saying that the tender was competitive, has complied with the rules and has been approved by upstream energy regulator BPMigas. He added that the winners were picked for the combination of meeting the requirements and proposing the lowest project price.

BPMigas chairman R. Priyono also denied the agency has failed in monitoring the project, adding that all tenders are examined by the Supreme Audit Agency (BPK).(*)