Executives of state-run explorer Oil and Natural Gas Corporations may no longer be able to use its golf courses in Ahmedabad and Vadodara for hosting business partners.
In the case of ONGC’s Ahmedabad Golf Course, the holes were dug and fairways made after the explorer struck oil in the city more than two decades ago. Wary of encroachment around the oil wells in a city that was developing into a megapolis, ONGC had built a golf course around the wells.
Now, however, the Department of Investment and Public Asset Management (DIPAM) has deemed golf courses and sports clubs owned by central public sector enterprises as ‘non-core’ assets and wants to monetise them. Also on the list of potential asset sales, as far as hydrocarbon CPSEs (central public sector enterprises) are concerned, is the sports club owned by Bharat Petroleum Corporation Limited (BPCL) in Chembur, Mumbai.
The nod to monetise non-core assets of ONGC and BPCL was taken at a meeting of officials from DIPAM, Niti Aayog, oil ministry and other departments. The proceeds from these sales will go to the CPSEs and not the exchequer, officials said, because the aim was to rationalise resource utilisation in the public sector.
The DIPAM diktat has put ONGC into a quandary since selling the golf course would mean the buyer also gets ownership of the oil wells, which are still producing oil. The existing rules governing nomination blocks also do not allow the licensee to sell or transfer land ownership.However, the DIPAM exercise has identified only properties with real estate potential in prime cities while leaving out golf courses the company has in Ankleshwar in Gujarat and Rajahmundry in Andhra Pradesh. It also did not prioritise the sale of Oil India Ltd’s grand golf course in Assam and ONGC’s golf course in the North-East.
The Motera field in Ahmedabad may be one of the 64 that ONGC has identified where private or foreign firms may be utilised to raise output. The field lies in a block licensed to ONGC under the nomination policy that existed before the government began auctioning acreages in 1999. However, even under that policy, ONGC retains ownership of the field and licence, with private partners coming into the picture only when raising output beyond a pre-agreed threshold.
ONGC officials find themselves in a quandary
The DIPAM diktat has put ONGC into a quandary since selling the golf course would mean the buyer also gets ownership of the oil wells located in the premises, both of which are still producing oil.