"Saipem" and "Bonatti" will work on pipeline replacement?

By Laura Suleimenova

At the recent NCOC public hearings re. replacement of pipelines at Kashagan (see "Kashagan: new expectations, old concerns") NCOC managing director Stephan de Mayo didn't name the companies that will participate in this project.

Nevertheless, according to informal information, the former general contractor - the Italian company "Saipem" will be involved in the project. It will work on offshore section of the pipeline, and the activities on an onshore part will be given to the subcontractor - the Italian firm "Bonatti".

One of the shareholders in the North Caspian Project (16,8% of shares) – the Italian oil and gas company Eni owns 43% of “Saipem” shares. However, according to our sources, the reason for the repeated invitation of "Saipem" to the project has no relation to its affiliation with Eni, but is due to the fact that "Saipem" has a specialized fleet for laying of pipes in the sea. And the consortium has no time to search for other contractors in the current situation.

In 2006 Saipem delivered to "The Caspian shipyard" Castro-12 pipe layer barge for “The Kashagan Project Offshore Main Pipeline”. Besides, the Italians have a “TRB” barge for laying pipes in trenches and in August of last year “The Er-Sai1” pipe layer barge was delivered to the Caspian Sea, built as per Saipem SpA’s order by “Offshore and Oil and Gas Projects” group (“MNP”). The cost of the barge was $35 million.

As for “Bonatti”, the transference of onshore scope to it became a surprise for other participants of the tender. Here, as our sources say, absolutely other factors played a role. 

The matter is, that three years ago Agip KCO, being then the agent company responsible for construction of the 1st phase facilities of the North Caspian project, put “Bonatti” into a “black list”, because in May, 2011 it spilt fuel on a huge area on the Bolashak plant territory. Agip demanded that “Bonatti” should clean the polluted territory, however “Bonatti” refused to accept the claim from the former customer.

Meanwhile, the Department of ecology of Atyrau Oblast imposed a major fine on Agip KCO for this spill. Agip in its turn “froze” the payments to “Bonatti” for the performed work, and “Bonnati”, as a result, became indebted to its subcontracting companies.

“After Eni, whose “daughter” company is Agip, included “Bonatti” into a “black list”, the latter had financial claims to Eni for the amount of $15 million. In order for Bonatti to remove that claim, Eni decided to involve it into the project for replacement of pipes. A sort of “settlement deal”. And because a lot of money is required for various “commission charges”, including to Eni management, “Bonatti” offered the price $170 million, although the real cost of onshore activities is not more than $100 million”, -say our informed sources. According to them, Stephan de Mayo, the representative of another shareholder of the North Caspian project -the American company Exxon Mobile, was “shocked” by such combination played by Eni and “Bonatti”.

We sent an official inquiry to NCOC with the request to comment on a probable selection of “Bonatti” as the contractor for replacement of pipelines. However, the consortium didn't comment on these questions, referring to “confidentiality” of information related to the sizes of expenses and the suppliers.