The Hindu : Business : High subsidy payouts a cause for concern: ONGC chief

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Friday, Jul 06, 2007
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High subsidy payouts a cause for concern: ONGC chief

Sujay Mehdudia

‘Will strive to work to reverse the trend of declining production’

Highest reserve accretion in 13 months
Co. made discoveries in Egypt and Iran

NEW DELHI: The newly installed Oil and Natural Gas Corporation (ONGC) chief, R. S. Sharma, on Thursday termed the rising payout of kerosene and LPG subsidy as area of ‘concern’ and promised to work for reversing the decline in production and cutting down rising expenditure during his almost four year tenure.

In a message to the 34,000-strong ONGC workforce, Mr. Sharma, who was formally appointed Chairman and Managing Director of the corporation on Wednesday, said he would strive to work to reverse the trend of declining production from the ONGC fields that have aged over a period. “The areas of concern are decline in production from ageing fields, rising exploration and production expenditure, constraints of oil field services, high subsidy payouts, under-recoveries in gas business and employee attrition, he has stated.

Mr. Sharma expressed concern at rising subsidy payout that increased 42.4 per cent and stood at Rs. 17,024 crore in 2006-07. At the same time, he listed the achievements, including highest-ever profit, rise in oil production and highest reserve accretion in the past 13 months but vowed to take strict action against complacency and indiscipline in certain quarters.

“As I look back, the preceding 13-month period has been one of the most demanding and challenging phase of my 19 years’ career in ONGC. Nevertheless, I feel contended that during this period, ONGC not only consolidated its stature as an established exploration and production company of global repute but also made significant achievements,” he added.

ONGC, under him, has taken investment decisions totalling Rs. 34,379 crore for revival of production from ageing fields, besides starting work on Tripura power plant and Dahej petrochemical complex. The company also added nine new projects overseas and made two major discoveries in Egypt and Iran.

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