A HALF-BILLION-DOLLAR contract to be awarded by Heritage Petroleum Co. Ltd. through a limited bidding process for an offshore production and compression facility has come under scrutiny from industry insiders.The facility is intended to process oil and gas from the West/Southwest Soldado fields.Heritage has defended its decision to use a limited bidding process and exclude international suppliers from participating in the procurement exercise (see separate story).However, the company’s decision has raised serious concerns among several industry insiders because of the magnitude, scope and complexity of the multimillion-dollar project.
An internal Heritage document obtained by the Sunday Express, titled “Approval of the Bid List and Procurement Strategy for Provision of a Production and Compression Facility for South West Soldado,” places the value of the contract at $570,611,800.According to the document, the following three local companies achieved pre-qualification status:1. TOSL Engineering, which has been providing a Mobile Offshore Production Unit (MOPU) since 2019. Its contract has already been extended twice, with the current agreement due to expire on March 7, 2026. A further one-year extension is being sought until a new supplier is selected in March 2027.2. Namalco Construction Services Limited3. Anti-Corrosion Technical Services Limited (ACTS).The deadline for tender submissions was scheduled for the end of May 2026.In the document, Heritage stated that it planned to “engage the market for a five-year lease agreement with an experienced contractor to provide [the] facility,” aligning with its strategy of outsourcing services rather than developing in-house capacity.Why no open bidding?Industry insiders noted that Section 5.1 of the Public Procurement and Disposal of Public Property (Procurement Methods and Procedures) Regulations states that “a public body shall utilise open bidding unless the complexity of the procurement or market conditions renders another method more appropriate for achieving the best value for money.”Several insiders familiar with the procurement strategy and bidder selection process raised concerns about the pre-qualification of two of the contractors.“We noticed that one of the contractors submitted an application for pre-qualification on February 13, 2026, at 10.04 a.m., and it was approved at 11.32 a.m.—just one hour and 28 minutes later—by someone within the company. Another contractor submitted its application on December 11, 2025, and received pre-qualification approval seven days later.“There is no way anyone can be approved so quickly, considering the evaluation criteria and the need to assess financial, technical and HSE requirements. This process typically takes between four and six weeks,” one insider claimed.Several insiders also questioned whether ACTS and Namalco Construction Services Limited had proven operational experience in this area.One senior industry source questioned how Heritage determined the composition of the available supplier market.“How did Heritage determine who comprised the available limited supplier market? From the market analysis we conducted, the supplier pool included TOSL Engineering, Compass Energy (Canada), Grander Energy (Singapore), Aurora Maritime (Singapore) and Aquaterra Energy (United Kingdom),” the insider said.According to the insider, these international firms are recognised specialists in supplying this type of equipment and service.Another informed insider criticised Heritage’s position, stating:“The concern is whether Heritage properly identified the global supplier market, considered international suppliers, applied objective pre-qualification criteria and avoided artificially restricting competition.“If only three local firms were invited despite the existence of international suppliers capable of providing the service, a legitimate question arises as to whether the supplier market was defined too narrowly.”Value for MoneyAddressing the decision to invite only three local suppliers, one insider said:“The legislation does not prescribe a minimum number of bidders for limited bidding. However, the act emphasises value for money, fairness, effective competition and transparency.”Another argued: “For a contract worth hundreds of millions of dollars over five years, a challenger could reasonably ask: ‘Why were only three local companies invited when the offshore production and compression market is demonstrably international?’“That question becomes even more significant if no international suppliers were approached, no international market sounding was conducted, and there is no evidence that only three suppliers were capable of performing the work.”Industry insiders also noted that the estimated value of the contract exceeds $500 million, making it a procurement exercise of considerable strategic, financial and operational importance.“Given the market conditions that have been identified, the use of limited bidding restricted to three invited contractors appears inconsistent with the legislative preference for open bidding.“Open bidding with pre-qualification would have been a more appropriate procurement method because it would allow broader market participation, preserve competition, ensure that only technically capable firms are shortlisted and promote value for money,” one insider said.Another added: “I have not seen any robust or documented justification demonstrating why open bidding was unsuitable. In my view, the procurement method used in this Request for Proposals (RFP) is vulnerable to challenge under the Public Procurement and Disposal of Public Property Act, 2015, as amended.”Several insiders agreed that a more appropriate and legally defensible approach would have been open bidding combined with pre-qualification, pre-selection and/or a two-stage tendering process.All of the industry sources interviewed agreed that, in the absence of a documented and compelling justification for limiting competition, the procurement method chosen may be inconsistent with Heritage’s obligations to conduct procurement proceedings in a transparent, fair and non-discriminatory manner while securing the best value for money in accordance with procurement legislation.
