Govt re-initiates process to find new IOC chairman, retirement age kept at 60 years

The government has invited applications for the new chairman of Indian Oil Corporation (IOC), ending the uncertainty over continuance of incumbent Shrikant Madhav Vaidya.

In an advertisement posted on its website, the Ministry of Petroleum and Natural Gas sought applications from engineers, chartered accountants and cost accountants with post graduate management degrees from leading institutions and having at least 5 years experience in leadership roles, by July 3.

The age eligibility cut off has been set at not more than 58 years for internal candidates and 57 years for outsiders with 60 years as retirement age, it said.

Vaidya, who took over as the chairman of India's biggest oil company on July 1, 2020, was to retire on August 31, 2023 when he attained the superannuation age of 60 years.

But he was in a rare move "re-employment on a contract basis" for one year "beyond the date of his superannuation i.E with effect from September 1, 2023, till August 31, 2024," according to an official order dated August 4, 2023.

Thereafter a three-member search-cum-selection committee was constituted to find who will head IOC after August 31, 2024.

The panel is headed by the government headhunter Public Enterprises Selection Board (PESB) chairperson and includes the oil secretary and former Hindustan Petroleum Corporation Ltd (HPCL) chairman M K Surana as members.

The committee, however, couldn't make much head over the age eligibility issue.

Sources said the ministry initially proposed allowing anyone who has not attained the age of 61 years to be considered for the job.

This made Vaidya eligible for the job.

However, the proposal did not find favours with the Prime Minister's Office (PMO).

Thereafter the government reverted to the old system of appointing PSUs head with 60 years as the retirement age.

Prior to Vaidya, no chairman of a Maharatna PSU was given an extension beyond 60 years in recent years.

In fact, the government had last year denied Ranjan Kumar Mohapatra an eight-month extension as director (human resources) of IOC till his superannuation age.

The oil ministry recommended an extension of service for Vaidya after PESB in May last year did not make any recommendation for the next chairperson of IOC after interviewing 10 candidates, including Chennai Petroleum Corporation Ltd (CPCL) managing director Arvind Kumar.

IOC's was the second instance in recent months where PESB did not find a suitable candidate for the top job at blue-chip oil companies and retired personnel were given charge.

On June 3, 2021, PESB did not find anyone suitable from nine candidates, including two serving IAS officers, to head ONGC.

The ministry thereafter constituted a search-cum-selection panel and named Arun Kumar Singh, who had retired after attaining 60 years of age from Bharat Petroleum Corporation Ltd (BPCL), to head ONGC.

Singh wasn't eligible to apply in the first place but the eligibility rule was changed to allow consideration of persons who have attained 60 years of age.

A similar but bigger age relaxation (allowing persons up to age of 61 years to be considered) was being sought for IOC.

Existing rules for hiring board level positions in PSUs allow consideration of candidature of an internal person with at least two years of service left before retirement and three years in case of outside candidates.

The advertisement issued by the ministry said the new chairman of IOC would be selected by the search-cum-selection committee.

IOC refines crude oil into products like petrol, diesel, liquid petroleum gas (LPG), and aviation turbine fuels.

It also makes petrochemicals and retails CNG.

Besides being the backbone of Indian fuel supplies, IOC is pivoting India's energy transition -- the shift from fossil-based systems of energy production and consumption -- including oil, natural gas, and coal, to renewable energy sources like wind and solar, as well as lithium-ion batteries.

IOC owns and operates 10 oil refineries with a combined capacity of 80.6 million tonnes, making up for almost a third of India's 251.2 million tonnes of refining capacity.

It also owns 36,285 petrol pumps out of 86,855 pumps in the country.

Besides, it owns half of the nation's 25,386 LPG distributors.

It runs 131 out of 283 aviation fuel stations in the country.