by R. Sasankan
There
is a sense of satisfaction that a journalist feels when he gets it spot
on: when his forecast plays out just right. Allow me to feel more than a
little chuffed that my report of August 24 - Gas Migration: Collusion
Or Laxity – unerringly anticipated the conclusion that Justice A.P. Shah
would draw from the evidence placed before him.
Justice Shah concluded that the management of Oil and Natural Gas
Corporation had prior knowledge that Reliance Industries was leaching
gas from the former’s block in the Krishna-Godavari basin long before
the public sector giant filed a complaint in July 2013.
I wrote in my article: “There is certainly substantial merit in his (a
former senior executive of ONGC) contention that the ONGC leadership
knew about the interconnectivity of the reservoirs. Still, it looks
difficult for me to impute that some key people in the ONGC management
were in cahoots with those who had decided to suck out gas from the
neighbouring field. A journalist needs solid evidence and ONGC hasn’t
given me any. At best, one may say that there was some laxity. When I
told an expert about my conclusion, he drily said: “Such laxity without
cause is inexplicable.”
I
was elated to learn that the A.P. Shah Committee report, which was
submitted a week later on August 31, arrived at the same conclusion
about ONGC’s role in the gas migration saga. The Report says: “There is
substance in DGH contention regarding ONGC’s prior knowledge… Prima
facie, ONGC had prior knowledge and chose not to take action until
2013.”
Justice Shah has now asked the government to carry out an investigation
to determine the reasons for ONGC’s inaction until 2013. The learned
judge did not use any harsh words in his report because his role was
advisory with no adjudicatory powers. He did not use the word collusion;
nor did he upbraid the ONGC management for failing to submit the
documents that he had asked for. But the mild reproof in his report has
the weight of a sledgehammer that can burst open a sordid can of worms:
“Pertinently, ONGC promised to produce before the Committee the new
knowledge of connectivity /continuity that it had purportedly acquired
between 2007 and 2013 but did not do so.”
The
Shah committee was equally scathing while commenting on RIL’s role in
the so-called gas migration saga. ONGC chairman D.K. Sarraf won the
battle by cornering RIL and substantiating the charges against it. But
any compensation that RIL has to pay out – the amount will be determined
later – will go to the Government of India and not to ONGC. Sarraf had
also trained his guns on the two regulators who seem to have been let
off.
Sarraf hasn’t entirely covered himself with glory. He has laid himself
to criticism by failing to hand over relevant documents that might have
nailed the suspicion that his predecessors were in some way complicit in
allowing RIL to suck out the gas from ONGC’s field without a whimper of
protest.
It
appears that the ONGC management, in its anxiety to protect some of its
former colleagues, shied away from presenting records that would have
implicated the regulators as well. I had reported in a previous column
that RIL had sought and secured permission to carry out a 3-D survey in
ONGC’s block. My source was none other than a former exploration
director of ONGC whose tenure of service coincided with this crucial
period. Why was this fact hidden from the Shah Committee? This
information would have landed both regulators and the former ONGC
leadership in trouble.
Justice
Shah laments that “prompted by DGH submission, the Committee directed
ONGC to submit before the Committee records/files related to the
analysis /interpretation of the 3 D Q-marine seismic data along with
details as to when the G&G data became available, when the so-called
detailed interpretation was commenced at ONGC and to explain the
reasons as to why it took six years for ONGC to raise allegations
regarding continuity in the present matter. However, no such
records/files were submitted or explanation provided to the Committee”.
Justice Shah clearly delivered a rap to ONGC’s present leadership. The
Committee is obviously imputing that the current ONGC management has
been trying to protect the colluders within the organisation at that
crucial time. The Modi government cannot shy away from an investigation
into the matter.
So,
who in ONGC’s leadership team are in real trouble? R.S. Sharma was the
chairman from 2006 to 2011, the most critical period. Sudhir Vasudeva,
who succeeded Sharma, appears to be off the hook since ONGC initiated
the move to file the complaint against RIL when he was the CMD. It was
on July 22, 2013 that ONGC wrote to the Directorate General of
Hydrocarbons (DGH) stating that G&G data indicated evidence of
lateral continuity of gas pools of ONGC blocks with pools in the RIL
block and urged DGH to provide it with RIL’s production and well data.
This communication could not have been without the approval of Sudhir
Vasudeva who was the CMD. R.S. Sharma is a finance man and not a
geologist. So is D.K. Sarraf. The question now is whether Sharma failed
the test of integrity? The probe will determine that.
It
is true that geologists, particularly the director (exploration), play
the most crucial role in an issue like gas migration. D.K. Pande was
director (exploration) from September 2005 to February 2011, the most
relevant period, and had one of the longest tenures ever enjoyed by an
ONGC director. He was succeeded by S.V. Rao whose tenure lasted till
March 2013. ONGC acted on the issue in July 2013, about the time when
N.K.Verma became the new director (exploration).
How could Verma act with such alacrity in a matter of a few weeks after
assuming office? Did some fresh G&G data suddenly land on his table?
His predecessors had been recognised as competent professionals. Verma
was highly rated as well but he did not possess an extraordinary
expertise in geology that the others didn’t have. So, if there was no
fresh evidence that had suddenly emerged, it is pretty reasonable to
conclude that either Verma had prior knowledge about a reluctance on the
part of his predecessors to act on the available evidence or that some
bright youngsters within the exploration division had been feeding him
with information about the developments.
He
handled the issue as a top priority item. If he had not been convinced
about the merits of his move, Verma would not have dared to take on RIL.
Luckily for him, the next chairman happened to be D.K. Sarraf who
demonstrated exemplary courage in taking on both RIL and the MoPNG and
that too under a political leadership that had extremely friendly
relations with RIL.
Ever since, Sarraf, a simple, honest and unassuming man, has been
striding the corporate stage like a Colossus. He certainly has towered
over the other CMDs in the public sector. But it now turns out that he
too had an Achilles heel: a weakness that has in some way diminished his
stature. By refusing to abide by Justice Shah’s directive to submit
relevant records and files to ascertain whether ONGC had prior knowledge
about the interconnectivity of the reservoirs, Sarraf chose to save his
former colleagues from the guillotine. Fate, however, intervened when
Justice Shah outsmarted him by asking the ministry of petroleum and
natural gas to probe the matter further.
Sarraf is an Indian and he must have realised by now that there is a
limit to honesty in this country. However, by cornering RIL and exposing
the gas migration scam, he has done a great service. That by itself has
cemented his position among the great leaders within India’s public
sector.
ONGC is the country’s pride and the nation expects its chief executives
and directors to espouse certain ethical values. The proposed probe will
reveal whether they really deserved to occupy the exalted positions
they did.
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