Gas Cracker Project; ONGC's reluctance in signing deal flayed

NEW DELHI, April 4: The delay in signing of the gas supply agreement between the ONGC and the Reliance Assam Petrochemical Limited (RAPL) has been attributed to inability of the oil company to provide quality assurance, forcing the members of the Parliamentary Committee attached to the Petroleum and Natural Gas Ministry to seek the intervention of the chairman. The ONGC plea that it has not been able to sign the gas supply agreement with the RAPL on account of its inability to provide quality assurance on gas supplied for the mega gas cracker project found few takers in the Parliamentary Committee, who pointed out that when Oil India Limited (OIL) can provide such an undertaking, what was preventing the oil giant from doing it. The issue figured at the Parliamentary Standing Committee meeting held yesterday, with the chairman of the ONGC, BC Bora replying, though they had the quantity required for the project, they were not in a position to guarantee the quality of the gas. The Ministry's reply that it has not been able to take up expansion projects in the Gauhati Refinery owing to crude shortage evoked sharp reactions from the members who wanted to know what steps the Ministry had taken to revive the operations in Nagaland, closed for the past eight years. ONGC's operation in Nagaland was suspended following troubles with the state government as well as the Naga underground. While the state government demanded a share in crude pumped out of oil wells in the State, various Naga insurgent outfits imposed local taxes forcing the Oil Company to suspend the operations in the State. Raising the issue, Paban Singh Ghatowar MP, who is a member of the committee said that ONGC's delay in signing the Agreement has held back the project causing disenchantment among the people of the State. He also wanted to know why the public sector undertaking was dragging its feet in the matter. A member of the Committee said that the Chairman of the Parliamentary Standing Committee, Mulayam Singh Yadav was requested to intervene in the matter and convene a meeting with the Secretary Petroleum and Petrochemical to resolve the stalemate between the RAPL and ONGC. The ONGC it may be mentioned here, is to supply a fraction of the gas requirement, while bulk of it is to be supplied by the OIL. Initially, the oil giant had mentioned that the Gas Supply Agreement signed between the OIL and RAPL would be the basis of their agreement. But the clause regarding supply of quality gas obviously stumped them with the ONGC now expressing their inability to give a similar undertaking. Meanwhile, the issue of revival of the ONGC's Nagaland oil operations also figured, with the members accusing the Petroleum Ministry of wilful neglect.