OREANDA-NEWS. April 25, 2011. It’s not just ageing oil wells in Assam and Gujarat that India’s largest explorer Oil and Natural Gas Corp. Ltd (ONGC) is grappling with. The company is working hard to come to terms with a looming manpower crisis as at least 100 employees retire every month.

After the Mumbai High (earlier called Bombay High) discovery in the mid-1970s that led to a recruitment drive till the 1980s, the state-owned company went slow on hires in the 1990s. Subsequently, there was an exodus of staff to the private sector and greener pastures in the Gulf.

Of the 40,000 employees it had at the end of 2000, at least 11,000 have left or retired as of 2010, leaving a void of skilled workers. It now has 33,000 employees, of which 4,000 have been recruited in the last three years. Four thousand are set to retire by 2014.

“This turnover factor being easily identifiable is well within the capacity of the company to manage. In fact, the company has been pursuing an aggressive intake policy during the past three-four years,” a spokesperson said. On Wednesday, when the board of ONGC visited a site near Ahmedabad to celebrate the golden jubilee year of the firm’s first well in the region, acting chairman A.K. Hazarika represented about half its strength, also concurrently director for onshore, human resources and new business initiatives.

The company’s new exploration director B.K. Rao joined a month ago and will reach the retirement age in two years. “The process for the appointment of a new chairman is on,” said petroleum secretary S. Sundaresan, who visited the site with ONGC’s top officials.

The average age of an employee in ONGC today is about 48-50 and many experienced people are in the retirement mode, according to Hazarika.“Retirement of experienced employees is of serious concern to us. We are trying to promote younger people. They have to be trained faster to take up responsibility quicker. There has been a lot of attrition in the past, but it has come down considerably today,” according to Hazarika.

In a bid to curb attrition, the company has been recruiting about 1,000 people a year in the past four years, he added. The company has government permission to induct 1,500 more. All the recruitments are made at the entry level.Many of the key people in companies such as Reliance Industries Ltd and Gujarat State Petroleum Corp. Ltd are from ONGC, Hazarika said. Almost all officers at director and executive director level at ONGC are set to retire by 2013. Their current average age is 58 years, according to official figures.

“ONGC is a company that requires people with expertise. Areas such as exploration and drilling require experienced people, and this can come only with time. Replacing 10,000 experienced hands having 20-30 years of experience with new ones will not help much immediately,” said an ONGC official, who did not want to be named.

The shortage is most severe among specialized workers such as senior scientists and engineers, and it will take anywhere between five and 10 years to train replacements to help close the gap, another ONGC official said. He, too, requested anonymity.

There are close to 1,400 managers in drilling, production and reservoir disciplines. “The average age for E4 level officers (managers), including those who have risen from ranks, is 50 years,” according to the company spokesperson quoted earlier. From the current pool of 474 officers at executive director, general manager and group general manager levels, 256 are going to retire by 2013.

An official at an oil and gas field in the eastern part of India said there was no crisis as there had been some excess hiring in the past on hopes of another big discovery similar to Mumbai High.“Only few departments may be affected. Also, the recent hiring is not done on a one-to-one basis and is a mass recruitment drive. ONGC has been a pioneer in oil and gas exploration activity in India and it has a limited history of turnover. When private players came in, the one place they shopped for talent was at ONGC,” the official said on condition of anonymity.The company said salaries have improved at the state-run company.

“There has been a recent revision in the ONGC pay scales,” the company said in an emailed response. “The new scales are quite attractive compared to private organizations. In fact, at the initial level, they are more than that of the private sector and have been attracting the needed talent to the company.