ISLAMABAD: The board of directors of Oil and Gas Development Company Limited (OGDCL), its management and the ministry of petroleum are at the loggerheads over the sale of a gas field and appointment of a professional managing director of the country’s largest oil and gas producer.
Informed sources told Dawn that the relationship between OGDCL Chairman Farooq Rehmatullah and officiating Managing Director Shah Mahboob Alam have reached to a stage that Mr Alam has accused Mr Rehmatullah of interference in the affairs of the company.
On the other hand, Mr Rehmatullah has demanded of the government to immediately appoint ‘a competent, professional and experienced individual” from the exploration and production sector as managing director of the company ‘in consultation with the board of directors of the company’.
The sources said the OGDCL was currently considering ‘farming out’ a very promising field Sara Suri in Sindh to a new entrant State Canada.
A few days ago, the chairman OGDCL board asked the relevant officers of the company to ‘review again the reserve potential of Sara Suri fields at deep drilling zone and determine the price at which it would be profitable for OGDCL to continue operating the field”. The chairman had also wanted legal implications of turning around the field at this state should also be looked into. The managing director was flabbergasted over the development. He said the progress report of the field would be submitted to the board on completion but it was not fair on part of the chairman to interfere directly into the company affairs.
“I feel there is no need for you (Mr Rehmatullah) to hold a meeting with the officers of the company”, he said and added “this should have been done through MD/CEO rather than dealing directly with any officer and that too without my knowledge”.
The managing director also complained to the minister and secretary of the petroleum ministry and insisted that the chairman should consult the managing director for ensuring smooth flow of the company’s operational activities and harmonious understanding between the board and the management.
Chairman Rehmatullah filed a cross complaint to the petroleum ministry that “apprehensions and insinuations” expressed by the managing director were “misplaced and baseless”. He reminded the managing director that section 196 of the Companies Ordinance 1984 clearly entailed that “business of the company shall be managed by the board of directors who may exercise all such powers as are required to be exercised” because they hold a fiduciary relationship with the company.
He also pointed out that code of corporate governances also required that “the directors of listed companies shall exercise their powers and carry out their fiduciary duties with a sense of objective judgement and independence in the best interests of the listed companies”.
The chairman said the managing director did not have the knowledge how a corporate organisation should function and should familiarise with the Companies Ordinance and code of conduct. Mr Shah Mahboob Alam, executive director security, was appointed as acting managing director of the company on January 5, 2010. The board of directors later unanimously resolved and recommended to the government on March 12, 2010 to shortlist three to four suitable candidates with professional background and experience in exploration and production in consultation with the board for appointment as full-time managing director. The ministry is yet to implement the recommendation.
Source The News
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