Vol. XLI No. 50 December 10, 2017

Privatisation of Oilfields Opposed

THE Petroleum and Gas Workers’ Federation of India, the largest federation of oil trade unions, has strongly opposed the action of the central government for handing over 15 oilfields of ONGC and OIL to private parties in the name of marginal oilfields auction. The government, under a policy adopted on September 2, 2015 after closing the New Exploration Licensing Policy (NELP), selected 67 oilfields for auction. The government claims that these oilfields are non-viable, remote and ONGC-OIL failed to produce oil and gases.

In the meantime, the government invited private parties to participate in the auction by lunching roadshows in India and abroad, declaring that total 86MMT of crude oil reserve is there in the 67 oilfields with a value of Rs 70,000 crore. If the government’s claim is genuine, then the whole picture of the up-stream oil industry would be changed because as on date the state-run Oil and Natural Gas Corporation (ONGC) and Oil India Limited (OIL) together are producing only 35-37MMT of crude. It proves that the future of the up-stream oil industry will be in the hand of private parties.

Moreover, the conditions formulated by the central government for auction of oilfields are totally in favour of the private parties. The basic conditions are: (a) The companies need not pay cess to the central government, (b) Royalty which is paid to the respective state government will be modified, (c) The private companies shall decide where to supply the crude and gas, (d) The private companies can fix the price of the crude and gas, (e) During exploration, if any other minerals is found, the parties will get the right of the minerals, (f) Transportation of oil and gas will be carried out through the system of ONGC/OIL by the private parties, (g) No past experiences is required for participating in tender.

After auction of 67 oilfields, if 86 MMT of crude oil is discovered, the control of upstream oil sector will certainly go to the hand of privates and the existence of public sector ONGC and OIL will be under big trouble. Very recently, the central government decided to put 15 oilfields of ONGC and OIL on auction in the name of non-viability. But, as per the information, a reserve of about 791.2 million metric tons (MMT) of crude oil and 333.46 million cubic meters of natural gases are there in the 15 oilfields.

The Federation observes that during UPA government, 9TH round of NELP was conducted and many oilfields with huge reserve of oil and gas discovered by ONGC and OIL were handed over to the private parties. The most viable Mukta and Punna oilfields, which were discovered by ONGC in the Arabian Sea, were handed over to the private parties. We know the biggest scam of natural gases at KG Basin which was perpetrated by Reliance by stealing gas from ONGC field. There are many cases of looting of national property by the private companies. Still the central government is patronising the private parties for the interest of the corporate and to destroy the state-run ONGC and OIL.

The Federation strongly protests such anti-national activities of the government and urges it to stop the process immediately. In a statement issued on November 28, the Federation appealed to all oil trade unions to raise their voice against the policy to save oil PSUs and national economy.