Govt leaves ONGC headless as musical chairs continue

Jan 01,2022

For more than 24 hours since 5 p.m. on Friday, no one has been in charge of India’s most valuable public sector company, , as the government failed to appoint even an officiating chairman after incumbent Subhash Kumar superannuated.

It is quite likely that India’s flagship explorer, which accounts for the bulk of domestic oil and gas production and has annual capex plans in excess of Rs 30,000 crore, will continue to be headless for another 24 hours unless the government goes out of the way and orders someone to take charge on Sunday.

In normal circumstances, director (HR) , the seniormost functional director on the board, would have been asked to take on the mantle from Kumar. While the oil ministry did no such thing, it issued an order on December 28 giving director (onshore) Anurag Sharma additional charge as director (finance) -- which was Kumar’s job before he was given the additional role of chairman -- from Saturday.

The situation, industry observers said, was unprecedented and could indicate the government’s desire to hoist a bureaucrat as chairman with the aim of subjugating the management into hiving off ONGC’s large producing fields. They pointed to repeated letters written by a senior bureaucrat in the ministry, asking the company to sell a major share in Mumbai High and Bassein fields to private firms – ostensibly with the aim of inducting technology for raising production.

Indeed, ONGC has been without a duly selected chairman since February 2021 after Shashi Shanker retired. Kumar was appointed as Shanker’s successor as he was the seniormost functional director on the board and retired as chairman since the government failed to find a regular chairman through due selection process – either through government headhunter PESB or search-cum-selection committee.

Usually, the Cabinet’s appointments committee puts the seniormost functional director in charge as chairman if a successor is yet to be chosen or appointed before the incumbent retires. The appointment can be for three months or till the appointment of a regular chairman selected through due process. The order is usually issued 2-3 days before the incumbent’s retirement, giving time for briefing the replacement.

The administrative minister- Hardeep Singh Puri in case of ONGC-- also has discretionary power to put someone in charge on an ad-hoc basis for three months in case the appointments committee does not take a call.

Curiously, PESB on June 4 last year conducted interviews for selecting Shanker but did not find anyone suitable from among nine candidates, including two serving IAS officers. It later said a selection committee will be set up to widen the search. The committee is yet to be set up.