Lifecycle evaluation reshapes BHEL Air Separation Unit tender
BHEL has issued a global turnkey tender for an Air Separation Unit that will support the proposed Coal to Ammonium Nitrate project at Bandhabal, Odisha. Unlike conventional supply contracts, this package covers engineering, manufacturing, erection, commissioning, operator training, guarantee testing and long-term performance responsibility under a single contractor.
The revised tender demonstrates that Air Separation Unit procurement is increasingly focused on operational efficiency rather than lowest initial cost. Corrigendum-1 strengthened the pre-qualification criteria by requiring experience in a qualifying Cryogenic oxygen plant with minimum one year of successful operation and 98% availability. This significantly narrows eligibility to suppliers with demonstrated operating performance.
Commercial evaluation has also changed. Instead of relying solely on landed price, BHEL will compare bids after adding utility consumption using a 25-year net present value calculation. Power, steam and cooling-water consumption therefore become part of the financial ranking. This approach encourages suppliers to optimise lifecycle efficiency rather than minimise capital expenditure. The tender also introduces availability-linked liquidated damages, reinforcing long-term accountability.
EnergylineIndia.com observes that the repeated corrigenda mainly clarify documentation, commercial clauses and technical annexures without diluting the project's performance expectations. Contractors continue to carry responsibility for complete turnkey execution, while payment flexibility through letters of credit remains balanced by strict commercial loading rules.
The Bandhabal package signals how future Industrial gas plant procurements may increasingly combine lifecycle economics with technical reliability. Air Separation Unit suppliers capable of delivering proven efficiency, robust automation and dependable commissioning stand to benefit most. Air Separation Unit evaluation is now closely tied to operational performance rather than equipment pricing alone, BHEL, Gas Insulated Switchgear, Transmission Projects, GIS, Renewable Energy.
