Subir Raha, chairman and managing director of Oil and Natural Gas Corporation, has not been given an extension by the government and he will have to hang his boots by this evening.
The ministry is denying him an extension based on the negative remarks on his performance made by the previous Oil Minister Mani Shankar Aiyer and former Petroleum Secretary S C Tripathi and the T N R Rao Committee Report on the fire at a facility in the company's Mumbai High Field last year.
"Raha was appointed for five years or till the age of 60, whichever was earlier. His five year term comes to an end on Wednesday. We are not sacking him or terminating his service. In the normal course, the contract is coming to an end," a top oil ministry official said.
Sources, however, said the decision was contrary to the recommendations of Petroleum Secretary M S Srinivasan, who had favoured a three-month immediate extension and moving the appointment's committee of Cabinet for extension of Raha's services till August 2008, by when he would be completing 60.
The oil ministry is likely to ask the senior-most director on the company board R S Sharma, director (finance), or Anil Razdan, additional secretary in the petroleum ministry, to officiate as the acting CMD till a permanent appointment is made through the public enterprise selection board.
In an unprecedented move, the ministry had sought the comments of Aiyer, who is no longer the officiating oil minister, on Raha's performance.
Aiyer, in his one-page note, though praising Raha for his managerial capacities, criticised him for "insubordination and indiscipline" and not adding oil reserves of the company.
The former petrol minister said Raha had converted ONGC into a one-man show and was not a team player.
Interestingly, Raha is credited with the company's success in cleaning up its contract system, for its overseas foray where it has committed investments of $4.5 billion in properties in 14 countries and ONGC's vertical integration by acquiring MRPL and other refinery plans.
ONGC is India's largest company in terms of market capitalisation. Its market cap as of Tuesday stood at Rs 176,480.72 crore (Rs 1764.8 billion).
Sources also said Aiyer wanted V K Sibal, director general of directorate general of Hydrocarbons to succeed Raha. Sibal is the same person whom Aiyer as the oil minister last year wanted to appoint on ONGC Board.
They said though SHELL had given a clean chit to ONGC on the fire at Mumbai High platform in July last year. The TNR Rao committee had faulted ONGC management for lapses in getting safety certification for the installation. It is believed to have held the chairman responsible for the negligence, though internationally renowned safety consultants had certified the installation.
Tripathi had made negative remarks on Raha, who transformed ONGC from a docile public sector company into a global energy major, with global footprint, as a "non-performer".
Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group