Behuria might face competition at P-LNG

Vol 13, PW 22 (22 Apr 10) People & Policy
     

Petronet-LNG is setting up a ‘search committee’ to find a new MD, amid growing unease internally that Sarthak Behuria will be appointed to replace Prosad Dasgupta by default.

PETROWATCH learns such a committee will be high on the agenda when Petronet-LNG directors hold their next board meeting at the company’s World Trade Centre office in Delhi on April 27. Included on the search committee will be directors from promoter companies ONGC, Bharat Petroleum, IndianOil and GAIL.

In recent weeks industry rumours have strongly indicated that former IndianOil chairman Behuria, appointed company ‘advisor’ on March 2, is to be catapulted into the MD’s seat without the inconvenience of a formal interview. Some warn the Petronet-LNG board could even directly nominate Behuria.

“I don’t think it’s possible,” counters another source. “There’s no precedent for that.

” He adds Petronet-LNG’s Memorandum and Articles of Association clearly state that only a board-sanctioned search committee can select the MD. Others say any move to ease Behuria into the MD’s seat would amount to a gross violation of the basic principles of ‘transparent corporate governance.

’ “Petronet-LNG is a listed company,” he says. “It’s answerable to shareholders.

Such a decision will affect the company’s market image.” Yet fears abound that 58-year old Behuria, former bridge partner of oil minister Murli Deora, and known for his political connections, could circumvent any selection process.

“Behuria was promised this post by Deora, when denied an extension at IOC,” we hear. “If instructed, Petronet-LNG’s search committee could always claim he is the ‘best candidate’.

” Dasgupta has been managing director of Petronet-LNG since September 1, 2005 but is stepping down because of ill health and submitted his resignation in March. “The board will accept Dasgupta’s resignation during the meeting,” confirms a company source.

“It will also agree to set up a search committee to find a new MD.”