In the wake of opposition from the law ministry and the Department of Public Enterprises, the petroleum ministry has withdrawn a proposal to appoint additional government directors on the Board of Oil and Natural Gas Corp.
Petroleum Minister Mani Shankar Aiyar, who in April this year had proposed appointing additional directors including director general of Directorate General of Hydrocarbons V K Sibal on ONGC's board to bring in technical expertise, issued an order earlier this week withdrawing their nomination.
The move comes after DPE upheld ONGC chairman Subir Raha's stand that the number of government directors cannot be raised to four. The law ministry too endorsed Raha's view that Sibal's appointment was in conflict with his role as the upstream regulator.
The proposal to appoint additional directors, including Sibal, on ONGC's board had generated a major controversy with Raha threatening to resign. The ONGC chief had also made a reference to interference by ministry officials in the company's functioning at its Annual General Meeting on September 21.
"A listed company, even in the public sector, remains a listed company, not a department...companies are governed by the Companies Act, departments are administered under executive rules and procedures," he had said in the AGM.
Last week Aiyar clarified that he did not initiate the proposal to appoint Sibal and blamed bureaucrats in his ministry for the controversy.
Heavy Industries Minister Santosh Mohan Dev too had publicly endorsed Raha's view that the number of government directors on company board cannot exceed two.
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