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Punj Lloyd-ONGC face off-I: ONGC to cancel naphtha pipeline contract
Jun 12:
Well placed ONGC sources said that a big war of words has begun between Punj Lloyd Ltd (PLL) and ONGC over the delay of more than four years in the construction of the Dahej-Hazira naphtha pipeline.
8PLL is the EPC contractor but the pipeline could not be completed as the Right of Way (ROW) has not been obtained by ONGC.
8The cash strapped PLL has demanded a compensation for the delay and while ONGC had initially recognized the fact that it needs to come up with a compensation package, it has now backed out of it.
8Eventually matters have come to a confrontation between the two parties, and ONGC is now moving to cancel the contract by brushing aside other considerations, including an opinion from its own legal department that it cannot unilaterally cancel the contract, PLL sources said.
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8PLL is the EPC contractor but the pipeline could not be completed as the Right of Way (ROW) has not been obtained by ONGC.
8The cash strapped PLL has demanded a compensation for the delay and while ONGC had initially recognized the fact that it needs to come up with a compensation package, it has now backed out of it.
8Eventually matters have come to a confrontation between the two parties, and ONGC is now moving to cancel the contract by brushing aside other considerations, including an opinion from its own legal department that it cannot unilaterally cancel the contract, PLL sources said.
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