Standoff Broken At Paradeep Refinery Site But obstacles still persist in starting the project

The standoff surfaced in Paradeep Indian Oil Corporation Limited [IOCL] plant site on July 2 following a clash between a violent mob and the CISF which halted project work for five days virtually came to an end, after civil administration, IOCL authority, police, CISF higher-ups and trade unions converged in a meeting and reached an amicable settlement. As a result of this settlement the project work restarted, after agitated trade unions withdrew their strike on July 7.

But there still are plenty of obstacles in starting the project in scheduled time. Sourcing of water from Jobra barrage from river Mahanadi, local law and order situation, political unrests, unionisation and non-availability of requisite manpower including legal hurdles are some of the stumbling blocks which are pushing the project to brink in past few years. However, the IOCL authorities claim that the work at the IOCL Paradeep project is in full swing with thousands of engineers, technical professionals, architectures, designers, planners, contractors and labourers are engaged at project works. About 81 per cent work is complete and the project is likely to be commissioned by the end of 2012.

It is to be noted that it is Rs 29,777-crore mega-refinery project at Paradeep. The foundation of this project was laid 13 years ago by the then Prime Minister Atal Bihari Vajpayee amid much fanfare, aftermath the Super Cyclone of 1999 that devastated the entire Jagatsinghpur district. During the foundation stone laying function the then Prime Minister Vajpayee had said that the project was a gift for Odisha as a post-cyclone restoration package from union government. Initiating such a mega project Odisha could rejuvenate its devastating economy and cyclone-affected victims would be benefited and this would be the most modern refinery in India with a nil residue production.

But the project witnessed little sign of progress. The BJD-BJP coalition government was rapped for the project. Finally the central government sanctioned the project in the year 2008. The 15 million tonnes per annum, zero residue project was designed to process all kinds of imported crude oils and the project will have, apart from a crude and vacuum distillation unit, a hydro-cracking unit, a delayed coker unit and other secondary processing facilities. Besides the union government also proposed adding to it Petro Chemicals and Petroleum Investment Region [PCPIR] covering Jagatsinghpur and Kendrapada districts.

Land for the project was peacefully acquired by the state government and the land losers were well compensated and the project construction was kickstarted in the year 2008 and till date 80 per cent project work has been completed.

But trouble began with sourcing of water for the project. While the state government had agreed for providing water to the refinery from the Jobra barrage in Cuttack through 120-km pipeline, and the stretching of pipeline was initiated in the year 2010, an outfit Mahanadi Bachao Andolana protested against supplying of water from the river Mahanadi. A public interest litigation [PIL] was filed in Odisha High Court in the year 2011 against the refinery project saying water availability in river Mahanadi would be adversely affected. Acting on the petition High Court constituted an expert committee to study the petitioner’s allegations in November 2011. After considering the points raised by the petitioner the committee submitted its report in January 2012. Relying on the report the High Court delivered its judgment directing IOCL to implement several construction and corporate social responsibility activities such as dredging the river mouth to increase the storage capacity of water, strengthening the river embankments, constructing a water treatment plant, giving Rs 10 crore to a pediatric hospital and Rs 3 crore to traffic management, providing five ambulances to hospital and many more conditions. These pre-conditions ostensibly irked IOCL as the implementation of this judgment would amount to the tune of Rs 250 crore-Rs 500 crore. As a consequence, IOCL filed a special leave petition against the High Court judgment in the Supreme Court of India. Acting on the appeal, the Supreme Court in its order of May 2012 stayed the High Court order and the case is still pending before the apex court for final disposal. So water sourcing for IOCL lies in logjam.

With the IOCL work came to a halt following violence the authority of this central PSU led by its executive director M Vijaya Wargiya met the state home secretary Mr U N Behera and sought his help saying the district administration had completely failed to control the project site law and order conditions. They also pointed out that the IOCL was suffering huge losses following frequent violence. The police take lukewarm action against the trouble-makers and civil administration responds little on surfacing disorders, they added.

However, former minister and Paradeep MLA Damodar Rout was afraid of speaking against the district administration and police. In fact, IOCL seniors and Rout levelled charges against men in uniform and district officials for habitually taking money from the contractors, trade unions and local anti-socials working in project site impressing IOCL officials. Ironically, IOCL people have never bothered of taking assistance from the local people’s representatives during their crisis. In spite of Rout’s repeated appeals IOCL has been skipping to hold a mandatory RPDAC meeting for past few years. Moreover, Rout accused IOCL of substandard construction in IOCL works and demanded a CBI probe.

The growing trade unionism has also become an obstacle making delay in the scheduled completion time of IOCL project at Paradeep. As many as five major trade unions have been functioning at the project site since IOCL kickstarted oil refinery project. Report indicates that each union has been functioning as labour suppliers, its affiliated members get jobs in the project works. These unions also extend local defence and collect huge protection money from big construction companies which have been awarded contracts for structural works at IOCL site.

So, union leaders are playing a crucial role as those assigned construction houses are subletting their works. IOCL authority has given unions sketchy control to conduct these works and as a consequence they rule the region and collect huge money as no law prevents them from doing so. However, allegations are rife that few IOCL top officials were behind the incident. Recent violence at the project site too had erupted due to these reasons and civil administration maintained a studied silence.

The project inception got delayed due to shortage of well-cultured technical personnel and competent contractors. Even as IOCL is seeking international and national tenders for its project works, few bidders are coming forth. This can be attributed to local law and order conditions and influence of trade unionism. A a result, well-talented professional’s non-availability and labour scarcity too mar project works.

Congress leader Ramakrushna Pattnaik, who was finance minister in the then BJD government and became infamous for imposing sand royalty to IOCL project, opined that the project ran directionless due to lack of coordination between union and state governments since its beginning. The project was relegated to back burner after BJP lost polls in the year 2004 at the centre, and again restarted during tenure of Congress-led UPA government in the year 2008. But ironically the present BJD-ruled state government is paying little attention, pushing the project to the brink on many occasions.

Meanwhile, central Fertilizer and Chemical Minister Srikant Jena held a meeting in the second week of June with IOCL authority, state higher-ups and other stakeholders, reviewed the project progress and discussed the problems affecting the refinery project. He vehemently criticised the state government for its lack of political interest in project starting.

However, after IOCL violence, the Odisha government took up the matter promptly, as the project was very important for the state—around 35,000 people were on average engaged in project work. And following the violence the daily labour loss is at least 30,000 man days and monetary loss is around Rs 3 crore daily. So home department instructed district administration to resolve the crisis immediately. And following the intervention of district administration, normalcy returned the project site. In another major development, the state government has transferred district collector and superintendent of police.

 By Kahnu Nanda from Jagatsinghpur