ONGC Officers Upset With Proposal To Privatise Biggest Oil Field, Union Writes Letter To Hardeep Puri

The Union, representing ONGC's 1700 officers, said that the government instead of doing away with its prime assets to a foreign entities, should rather empower the company.  

New Delhi: The Association of Scientific and Technical Offices have petitioned Oil Minister Hardeep Singh, Puri, against a proposal to privatise ONGC’s biggest oil field to private companies, reported news agency PTI.

The proposal put by Amar Nath, Additional Secretary (exploration) in the Ministry of Petroleum and Natural Gas was to sell 60 percent stakes and operatorship of Mumbai High and Bassein & Satellite (B&S) offshore assets to a foreign company to increase output. 

This decision was met with strong resistance from the Officers’ union, which represents ONGC’s 1700 officers. The Union said that the government instead of doing away with its prime assets to foreign entities, should rather empower the company and give them a level-playing field. 

The Union further said that the employees and the company are in complete alignment with the government with regard to increasing domestic output by reducing imports, but for this, the government should provide ONGC with the same fiscal and regulatory regime as is provided to the private sector for exploring and producing oil and gas. 

"We would therefore request you that handing over producing fields on a platter to the private operator will not be successful and therefore, in our opinion, should not be pursued,” the Union wrote. 

The Union has written to Hardeep Singh Puri on November 11 that the government-dictated below market price gas price should be reviewed so that production from smaller and remote fields can be made viable. They also wrote to give the company the freedom to sell small pools of natural gas which is not feasible under the present price regime. 

According to the report, ONGC’s data for the last three years show that the company has been consistently involved in drilling more than 100 exploratory well every year at a time when international crude oil prices were at all-time low. 

In this regard, the Union wrote, “exploration of oil and gas is a highly risky endeavour where very few like to participate. "This is evident from the tepid response to the bids invited under OALP (bid rounds), where only ONGC and to some extent OIL are the only bidders."

The foreign and private players do not want to take the risk of investing millions in surveying and drilling wells to establish reserves. They instead want to tap into the already established fields, it stated. "The private operators most probably are giving priority to commercial aspects, the prevailing business climate and therefore may not be taking the risk that ONGC is willing to take," the Union added. 

(With Agency Inputs)