By an OGJ correspondent
MUMBAI, July 16 -- India's petroleum ministry has given an ultimatum to British Gas PLC, Reliance Industries Ltd., and state-owned Oil & Natural Gas Corporation (ONGC) to resolve by September the issue of operatorship of the joint venture Panna-Mukta and Tapti oil and gas fields, or to prepare for government intervention.
The three partners have been at loggerheads ever since BG claimed operational control after buying Enron's 30% stake in the fields for $350 million in January (OGJ Online, Jan. 23, 2002).
The move prompted ONGC—which owns the largest stake in the venture, 40%—to stake a counterclaim (OGJ Online, Feb. 19, 2002). Reliance, which matches BG's stake in the project with 30% equity, is backing ONGC.
Although the partners are tight-lipped over the imbroglio, sources revealed that if BG fails to give the chief operating officer's post to ONGC and the chief financial officer's role to Reliance, the Indian partners would bring into force the notice to strip the UK major of its operational control, therefore jeopardizing operations.
One of the options before the government steps in would be to take control through ONGC. "If ONGC could be trusted with Bombay High and several other fields in the region, there is no reason why it cannot be given control of Panna-Mukta and Tapti," a petroleum ministry official said. "Besides, ONGC discovered the field, and has the highest stake."
