Aker Kvaerner to make India sourcing hub

Anglo-Norwegian engineering and construction (E&C) major Aker Kvaerner will make India its hub for sourcing of E&C equipment and services for its international operations.

The group has set up a team, which will work with its local subsidiary Aker Kvaerner Power Gas Pvt Ltd (AKPG), for selecting and obtaining cost effective quality materials and services from the country, Stan Bogiel, senior vice-president - global sourcing, Aker Kvaerner group, said.

"The focus of our global procurement would shift to India and China from the West. This would help us minimise risks without compromising on quality. We are in the process of selecting vendors here, who would supply quality engineering equipment and services," said Bogiel.

The entire process of procurement is based on a project model titled 'Global Execution Excellence' aimed at minimising risks for the group, he said.

The Aker Kvaerner group has initiated its global procurement from the country by signing a global pricing agreement with Pune-based Virgo Engineers, a leading domestic valve manufacturer.

AKPG expects a significant rise in contracts awarded by its parent in the fields like petrochemicals, chemicals and polymers, refining, hydrocarbons and metals. The company provides engineering, project management, procurement and construction in these areas.

The local subsidiary has begun to play a significant role in serving its parent. AKPG engineers are playing a major role for its parent, for a $10 billion gas processing project of Shell in Norway, and other projects in Japan and Indonesia.

Aker Kvaerner has selected AKPG as its design centre for equipment meant for deep sea oil and gas exploration.

"With renewed focus of our parent towards India, AKPG is expects to double the revenue from its engineering services to $ 20 million in 2006 from $10 million in 2005," said Pothen Paul, managing director, AKPG.

AKPG, with an employee strength of 1,050, has an annual turnover of Rs 40 crore.