PURCHASE

DEPARTMENT
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Procurement Department is responsible for
procurement of goods and material to meet
requirements for distribution development
activities, various developmental projects, as
well as those undertaken by company on EPC
basis.
The nature of departmental work is semi-
technical and the personnel are supposed to
have a mix of commercial, technical and legal
expertise.

Procurement Department
Key Result Areas
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Basic Functions
Procurement Department
Procurement of Material through through Supply
Chain Management to meet organizations
requirement
Material Planning and Control

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Every organization has purchasing requirements.

Leverage Effect of Procurement
Small improvements in purchasing costs improve considerably the profit margin
of an enterprise
Reduction in purchasing costs goes directly to profit & loss statement

Quality Input - Quality Output
Timely procurement - Making possible to
achieve overall goals
Image Building - Window for outside world

Pivotal Role of Purchasing
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Our Values
Commitment - We are committed to our mission
and vision and to creating and
delivering stakeholder value

Courtesy - We are courteous with our
customers,stakeholders and towards
each other and encourage open
communication

Responsibility - We are responsible as individuals
and as teams for our work and our
actions. We welcome scrutiny and
we hold ourselves accountable.

Competence - We are competent and strive to
continuously develop and improve
our skills and business practices.

Integrity - We have integrity as individuals and
as teams our decisions are
characterized by honesty and
fairness.
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TRANSPARENCY
OPEN COMPETITIVE BIDDING
PROPERLY AUTHORIZED PROCUREMENT
WELL DOCUMENTED PROCESSING
WELL DEFINED AND NON- DISCRIMINATORY
EVALUATION CRITERIA
EQUAL OPPORTUNITY TO ALL BIDDERS
Guiding Principles of Procurement

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The department at Head Office level has been functionally divided into following sections:

i: Import (Direct Charge Material and Stores Stock) 6 Executives/15 Subordinates

ii: Local Purchase Direct Charge 9 Executives/11 Subordinates

iii: Local Purchase Store Stock 5 Executives/5 Subordinates

Each section is headed by a Senior Officer( Grade-V) who is reporting to G.M(Procurement)/
Chief Officer Procurement. These sections also have Executives as Category Buyers and staff in
their hierarchy who are responsible for the tasks allocated to them.

Regional/Field Procurement Offices 18 Executives/51 Subordinates
The regional/field procurement offices cater for requirements at regional/field level. The
officers in Areas/Fields are administratively responsible to the concerned Regional Head/EIC
and functionally to GM(Procurement) at Head Office.

Total Establishment 38 Executives/82 Subordinates
(excluding GM,CO , Secy to GM and non-clerical subordinates)
Functional Organization of Procurement Department
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Quantum of procurements depends on the
Project activities and Distribution Development
targets for the period. However, it is around
Rs.20 billion per annum.
Total number of tender enquiries issued 3500
Total number of purchase orders placed 12000
Quantum of Purchases
YEAR-WISE PURCHASE DATA FOR THE LAST FOUR YEARS
PROCUREMENTS DURING LAST FOUR (04) YEARS
Year No. of Purchase Order Total Value
(Rs. Millions)
2008-09 12,607 12,350
2009-10 10,077 4,716
2010-11 8,310 7,853
2011-12 6,604 7,465
Total 37,598 32,384
About more than 60% purchases involves:
Gas Meters
Linepipe/PE Pipe
Coat & Wrap Material
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BUYING FROM GENERAL SALES TAX (GST)
REGISTERED SUPPLIERS ONLY

SUPPLIERS MUST BE REGISTERED WITH INCOME TAX
AUTHORITIES

SUPPLIERS HAVE CLEARANCE FROM PROFESSIONAL
TAX AUTHORITIES

IMPORT RESTRICTIONS FROM CERTAIN COUNTRIES

Statutory Requirements for Procurement
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1. VISION
2. MISSION STATEMENT
3. VALUES
4. STATUTORY REQUIREMENTS
5. REGULATORY REGIMES
6. PROCUREMENT MANUAL

Procurement Environment in SNGPL
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Procurement of Goods
Issuance of Tender Enquiries
Commercial Evaluation of bids
Award of Purchase Orders
Receipt of Material from Suppliers
Providing One-Window opportunity to Suppliers and
bidders for procurement of Goods
Pre-qualification of Manufacturers
Handling post procurement issues
Interfacing with outside agencies like PPRA,PAC etc


PROCUREMENT IN SNGPL

Procurement of Material is processed under the umbrella of a well
structured Procurement Manual which is synch with PPRA Rules.
The tendering process is based on competitive bidding wherein
transparency is ensured.
All major procurements are processed through tender notices
advertised in widely circulated daily News-papers as well as through
PPRA & SNGPL official websites.
Evaluation of bids for high value cases is done by a Bid Evaluation
Committee comprising senior executives of the Technical,
Procurement and Audit departments.
Checks and balances are maintained through pre/post audit.
Redressal of Grievance Committee has also been formed to address
the complaints of bidders, if any.
Receipt of material is being handled independently by Stores
department, headed by GM (Stores).
Total value of procurement is around Rs 10 billion, two third of which
is from indigenous resources.


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Procurement in SNGPL
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RECEIPT OF MATERIAL PURCHASE REQUEST IN THE FORM OF INDENT OR
LOCAL PURCHASE REQUISITION
SCRUTINY OF THE INDENT BY PURCHASE PERSONNEL
ISSUANCE OF TENDER ENQUIRIES
RECEIPT OF BIDS AND TENDER OPENING
EVALUATION OF BIDS
TECHNICAL EVALUATION
COMMERCIAL EVALUATION
ASSESSMENT OF OVERALL EVALUATION RESULTS
PREPARATION OF CONTRACT/PURCHASE ORDER
OBTAINING REQUISITE APPROVALS AND CLEARANCES
AWARD OF CONTRACT
FOLLOWING UP IMPLEMENTATION OF CONTRACT
POST SUPPLY/DELIVERY ISSUE
SETTLEMENT OF CLAIM

Procurement Process
A Birds Eye View