Petroleum Division begins probe into OGDC rift

Board chairman accused of spending millions on meetings, travel expenses

ISLAMABAD: The Petroleum Division has launched a probe into the affairs of Oil and Gas Development Company (OGDC) as the employees union has prevented company chairman from entering its premises and following opposition to the firm’s participation in international bidding for offshore blocks.

The move came as the chairman of OGDC board of directors allegedly interfered in the work of management, which sparked a crisis and forced the labour union to continue to ban the entry of board chairman into company premises.

The restriction was placed because of his daily visit to the company head office, attempts to micromanage senior officers and unprecedented interest in staff politics, sources said.

Chairman Qamar Sharif is also accused of spending millions of rupees of company funds on holding unnecessary board meetings, staying in five-star hotels and travel expenses from the US to Pakistan.

According to a spokesperson for the Petroleum Division, the energy ministry has decided to probe the stalemate following a row between the OGDC board chairman and the management. The benefits got by the chairman would also be investigated, he said.

The Petroleum Division had repeatedly advised Sharif to stay away from the affairs of the management as well as from direct interaction with officers of the labour union. However, he did not take the advice seriously.

He had also been advised to step down, but so far he has managed to cling to the office.

Company sources said no board chairman in the past tried to take part in company politics or day-to-day management and Sharif set a bad precedent.

The energy ministry has voiced concern that due to the unprofessional attitude of some private board members of OGDC in dealing with vital proposals for international ventures, the company would not be able to conclude agreements in time.

Owing to petty issues, a recent proposal for allowing OGDC, Pakistan Petroleum Limited (PPL), Government Holdings (Private) Limited and Mari Petroleum to participate in international bidding would have been sabotaged, had saner elements not intervened to save OGDC from embarrassment and loss of opportunity.

“The OGDC board has become dysfunctional due to poor leadership and infighting,” remarked an official of the Petroleum Division.

When asked by The Express Tribune, the OGDC chairman denied that he met officers of the labour union where he made a commitment.

The chairman, however, admitted: “Yes, both the gentlemen (representatives of labour union) came to see me when I took office. They presented a list of demands and I asked them to go to the management as it was not the role of the board. I never promised them.”

He was of the view that the labour union was the responsibility of the management. “The board works this way - first the management brings a proposal with recommendations to an appropriate board committee. The committee conducts due diligence and then the proposal is submitted to the board.

“Nothing should be presented to the board without examination by the relevant board committee.”

Acknowledging he had been taking travel expenses for US-Pakistan flights to attend company meetings in Pakistan, he emphasised “my travel expenses might be less than the travel expenses of other board members because I travel in the economy class and not in the business class.

“I come for one meeting, stay here until the next meeting. My USA house is being sold and I plan to move to Pakistan after my house is sold.”

As a matter of fact, he claimed, “the remuneration for OGDC board members for attending meetings is less than that for other boards, such as that of PPL and Mari Petroleum”.

However, other board members termed it a manipulated fact.

Labour union President Raja Saleem and Secretary General Akhlaq told The Express Tribune that the chairman did meet union representatives immediately after taking office in 2018 and promised to remove the salary cap in one month.

After one month, he stated that it would be done by the executive director of human resources, who was being appointed by him. Afterwards, the chairman said the salary cap would eventually be removed by the managing director.

The former managing director said he was not aware of the meeting and assurances given to the labour union.

The management insisted that the note of removing the salary cap was prepared on the demand of the board chairman. The Petroleum Division spokesperson said under the rules a board member could claim travel and residential support for attending board meetings. “This issue will be discussed again in the next board meeting,” he said.

“A report on the chairman’s opposition to participation in the bidding for overseas offshore blocks will be sought from the company shortly,” the spokesperson said, adding that the Petroleum Division was not a silent spectator.

“The ministry’s nominees on the board make sure that all business of the board is conducted as per rules and regulations.”

He said “it is the ministry’s responsibility to keep an eye on the affairs of companies that come within its ambit and to evaluate the performance of each board member including the chairman and even the MD. The ministry reserves the right to take remedial measures wherever deemed necessary under the rules.”

He emphasised that the ministry needed time to look into minutes of board meetings. However, “the important thing is that the joint bid proposal was agreed to by the board and finally it stood cleared by the Economic Coordination Committee (ECC) and the cabinet”.

Special Assistant to Prime Minister on Petroleum Nadeem Babar told The Express Tribune “there is a legal way of dealing with everything; otherwise media will be writing how the government does not care about laws and rules”.

“There is no rift between the board and the management and all matters are being dealt with as per norms and standard practice. Grievances expressed by the labour union will be addressed very soon in the best interest of employees and the company,” an OGDC spokesperson said. 

Published in The Express Tribune, January 8^th, 2020.

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