ONGC director suspended for Rs 23cr unawarded tender

ONGC director suspended for Rs 23cr unawarded tender

NEW DELHI: The government on Tuesday suspended ONGC board member Shashi Shankar on charges of alleged irregularities in processing a yet-to-be-awarded tender of 2011 for procuring equipment worth about $4 million, or roughly Rs 23 crore at current exchange rate.

This is the first instance of a member of the board being suspended since ONGC became a corporation in 1994. In 1992, when it was a government commission, M C Nawlakha, who was then the member (finance), was suspended. He retired in 1993.

Industry insiders said Shankar's suspension was a result of internal rivalry in the ONGC board. He was widely perceived as a strong contender for the chairman's post. There were others who said Shankar was being "fixed" by vendors affected by his efforts to streamline the procurement process.

As director (technology and field services) of the country's flagship explorer, Shankar supervises equipment and oilfield service tenders worth Rs 15,000-20,000 crore a year. Each of these tenders run into thousands of crores of rupees and final calls are taken through a collective decision-making process by board members.

An oil ministry statement said Shankar "committed gross misconduct while dealing with a tender for procurement of 21 'blowout preventers (BOPs)' and "has been associated with this tender as group general manager, officer on special duty to director (T&FS) and from January 2012 as director (T&FS)".

ONGC chairman D K Sarraf and Shankar did not respond to calls from TOI.

But, ONGC executives who have worked with Shankar said he had an unblemished run in the company till now, with not even a memo against him. While the suspension is neither a punishment nor proof of his culpability, it is likely to prove to be a handicap in his future growth, even if he gets a clean chit from the Chief Vigilance Commission.

Questions are also being raised on how Shankar could be appointed to the board if there was any charge pending against him.

Then there is the issue of whether Shankar could be held accountable for decisions taken under his predecessor's watch based on which the price bids for the tender were opened in December 2011 and Worldwide Oilfield Machine (WOM) emerged as the lowest bidder.

In August 2012, in response to reference from a BJP member of the then parliamentary consultative committee, who is now a minister in the government, the ONGC board's tendering committee headed by the chairman, formed a three-member task force in August 2012 to review the suitability of WOM.