People's Democracy

ONGC Must Take Over Rajasthan Oilfields

THROUGH a statement issued from New Delhi on September 29, 2011, the Centre of Indian Trade Unions (CITU) has expressed deep concern and shock that in the midst of a mad race between the French, British and US oil majors to grab Libyan oilfields, the government of India is allowing the Oil and Natural Gas Commission (ONGC), its own flagship explorer, to forfeit its rightful claim to the majority stake in Barmer’s oilfields of Rajasthan. The CITU statement, issued by its general secretary, Tapan Sen, pointed out that these oilfields have the potential to produce three lakh barrels of crude oil a day which is about 40 to 50 per cent of the present domestic production.

The CITU has also strongly deplored the government’s decision to permit M/s Cairn India to hand over the control of this precious oil asset to the UK based M/s Vedanta Resources which has no experience in oil exploration and production, but has got dubious reputation in bauxite mining in Orissa. Its subsidiary M/s Sesa, Goa, is facing investigation by Serious Fraud Investigation Office (SFIO) and has invited severe indictment from the Lokayukta of Karnataka on illegal iron ore mining in Goa.

The CITU has reminds the government of India that the oilfields like those in Barmer are owned by the government as national assets and contracted to private companies like Cairn India for the purpose of exploration and production only. Being a government owned company and having 30 per cent participating interest in these oilfields, the ONGC should exercise its pre-emption right to make a counter offer for the stake of Cairn India in national interest of self-reliance which cannot be compromised on the issue of valuation of the asset.

In such a scenario, the CITU has demanded that the government must intervene before the oil assets are handed over to tainted hands and ensure that the ONGC --- either alone or jointly with other oil PSUs like Gas Authority of India Limited (GAIL) and oil India Limited (OIL) --- take over the majority stake of M/s Cairn India in the Rajasthan oilfields.