IOC chairman Shrikant Madhav Vaidya gets one-yr post-retirement extension

The government has given a one-year post-retirement extension to Indian Oil Corporation (IOC) chairman Shrikant Madhav Vaidya - a rare event for anyone on board of a state-owned company.

"The Appointments Committee of the Cabinet (ACC) approved the proposal of the Ministry of Petroleum and Natural Gas for re-employment on a contract basis of Shri Shrikant Madhav Vaidya, Chairman, Indian Oil Corporation Limited (IOCL) for a period of one year beyond the date of his superannuation ie with effect from September 1, 2023, till August 31, 2024, or till the appointment of a regular incumbent to the post, or until further orders, whichever is the earliest," an official order dated August 4 said.

Vaidya, who took over as chairman of IOC on July 1, 2020, turned 60 on Monday and as per the rules was to superannuate from service at the end of the month. But now, he will continue for one more year as the head of India's largest oil company.

This is one of the very rare occasions when a director on the board of a PSU has been given an extension of service beyond his retirement age.

No chairman of a Maharatna PSU has been given an extension beyond 60 years in recent years. In fact, the government had earlier this 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 government headhunter PESB in May did not make any recommendation for the next chairman of IOC after interviewing 10 candidates including Chennai Petroleum Corporation Ltd (CPCL) managing director Arvind Kumar.

After the interview, PESB in an order on May 16 stated, "The Board did not recommend any candidate and advised the Ministry of Petroleum and Natural Gas to take an appropriate course of further action including search-cum-selection committee or as deemed appropriate for the selection with the approval of the competent authority."

This is 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 changed rules made him eligible.

PESB in May interviewed 10 candidates to replace Vaidya. No existing directors of IOC applied as none had the requisite two years of service left before retirement. Of the six directors, only director (marketing) Satish Kumar Vaduguri had a maximum tenure of 23 months before he retires in July 2025.

Besides Vaduguri, the IOC board has only two other directors - Sukla Mistry for refineries and Sujoy Choudhury for planning and business development.

The posts of director (finance) and director (human resources) are vacant for months and Director (research and development) S S V Ramakumar and director (pipelines) D S Nanaware retired in the last couple of months.

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.

Mohapatra was appointed director (HR) of IOC in February 2018 for an initial five-year term which was extendable till he attains the superannuation age of 60 years. Born on January 1, 1964, he would have attained the superannuation age on December 31, 2023. His five-year term ended on February 18 this year but he continued as a director on the company board in the absence of any advice on his extension.

The Oil Ministry subsequently told IOC that Mohapatra is not been given an extension till 60 years of age.