Birth of offshore in India - part 1

I recently received an email from the Chairman of Engineers India Limited, a consulting company I had worked for in the early seventies.

"On 15^th March 2014, EIL enters into the 50^th year of its glorious existence.  These 50 years have seen EIL scale new peaks, achieve many firsts and become an integral part of the growth story of the Indian Hydrocarbon industry.  It has been a remarkable journey and we wish to capture all the magnificent and wonderful moments in an EIL Book that we wish to launch on this occasion.You have been an integral part of the EIL growth story and we feel grateful to you for laying a strong foundation on which we continue to grow.  We would be privileged if you could share with us your special memories, anecdotes and photographs of yesteryears for inclusion in this book."

I was delighted that my old organization had remembered me and sent them my recollections of those years- " The offshore story- the beginnings" and " Mastering Offshore technology in India". For those wanting to delve deeper into these areas, there is also a book -"Pioneers of offshore technology in India" availble from Lulu.com.

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India’s Offshore story- the beginnings

“We are a nation of beggars and we shall remain a nation of beggars. We will never be able to do

anything so complicated ourselves. Don’t waste your life here. Go back to America.” Those words, from the then chairman of India’s national oil company, Oil and Natural Gas Commission (ONGC), on my proposal to create an indigenous capability in offshore industry, would change my life. And they were also the sparks that led to the creation of offshore technology capability in India.

It was 1970. I had come back after three years in the US. I returned to an India full of hope and excitement. Indira Gandhi had just vanquished the old guard of politicians and was now a prime minister in her own right. She brought a fresh air of optimism and a promise of a new era in the country’s future. The environment was reminiscent of the time when John Kennedy had taken over as the US president, some ten years before. She promised to eradicate poverty– indeed “Garibi Hatao”or “ remove poverty” was to become her election slogan- and was attracting theyoung and even older hardened professionals to hercause and to public service.

I had just completed a doctorate at the University of California, Berkeley in the esoteric area of “StochasticAnalysis of Offshore Structures.” My doctoral research was financed by Chevron and was considered pioneering work on the design of offshore platforms in deepwater. I had returned to India while trying to decide between accepting a job with an international oil company in the U.S. and rejoining the Indian civil service in the railways. While in Delhi, I read about India’s plans to start oil exploration work offshore of Bombay, and how the government was considering buying an offshore rig. Of course, since this was the first time that the national oil company, ONGC, would venture offshore, they had little or no indigenous capability.

 I had mentioned my area of expertise at some party –where, I do not now recall- but two weeks later, Lavraj Kumar summoned me to the Ministry of Petroleum. Lavraj Kumar had spent his career in Burmah Shell, but had recently moved over to the public sector and was then an adviser in the ministry of petroleum. He was to play a key role in fostering the public sectorafter his career in the private sector, and was later fondly recalled by his admirers as the “father of the Indian petrochemical industry.” I entered his chamber in Shastri Bhavan to find a gray haired, handsomeman who talked and chain smoked the entire time. Once he learnt of my background, he promptlyphoned Manmohan Pathak, the managing director of Engineers India Limited (EIL), the engineering company under the ministry, and told him that he needed to hire me straightaway. Manmohan, a MIT graduate, had just taken over as the first Indian managing director of Engineers India Limited in 1969 – a joint venture initiated by Bechtel, which planned to build a number of fertilizer plants, and had created this engineering company to prepare the drawings. It was a small company, perhaps 150 professionals, but Manmohan was full of ideas to make it the largest engineering and Process Company in south Asia. Manmohan was the central casting idea of a chief executive – tall, fair and handsome with

an engaging smile, and full of enthusiasm. He had developed a corporate plan for EIL that envisaged

expanding into a new area of technology every other year. And he wanted EIL to be a company that would provide service for any kind of process plant from concept to commissioning. Most importantly, though in his early forties, he was still full of idealism, andwilling to take risks. Over the next five years, I was to find out that he always stood by his word.

After hearing my plans to build an offshore engineering capability in India, he suggested that perhaps I could join EIL and build this capability by also bringing back other Indians around the world

that had some experience in offshore work. He promised to provide all support. He offered me three

times the salary of my civil service job, which, in 1970, was a princely Rs 400 or about US $40 per month.

Still smarting from my meeting with Johnson, I was willing to throw in my lot with him, but made two stipulations: one, I would report only to him since there was nobody else in the company who had any idea of the technology; and two, if I did not succeed in building a capability within two years, he would let me resign and leave the company.

 I soon found out that there were no more than six or seven Indians in the world at that time that were

working at senior levels in the offshore industry. During the next few years, I met up with all of them

to try and coax them to come back to India, even offering some my own job as the leader of the team.

But most of them were married, and hesitated to take a chance in a completely new environment. There were some – one, a soil engineer full of idealism, who returned but could not persuade his wife to live inIndia, and so went back after a short stay; another whose wife was able to nag him to return after I offered him a job, but he, too, found it difficult to stay in the political and hostile climate of the Indian public sector and moved onto other international companies, making a very successful career outside the country.The first recruit for the Offshore Engineering Department (OED) was Anil Lyall.

When he walked into my hotel room in Washington, I looked up to find a hippie with shoulder length hair, glaring at me through his glasses. 

“I want to go back to India and will work at anything that is required,” was his opening statement. Anil never asked about salaryor job title, his only desire was that his capabilities as a geological oceanographer be utilized. I explained what I was trying to do and that I was looking for people

with experience in the offshore oil industry, but if he was willing to return, I had an opening. I offered

him a job, fully expecting that he would not return. Imagine my surprise then, when a few months later, my secretary burst into my office in Delhi, desperately trying to mask a smile, to say that a young man with wild hair was outside saying that he was to work forme. Anil was outside, his long hair still very much there, but he was still full of passion and vigor. He became an invaluable part of the OED team and was to spend the rest of his professional life in EIL, retiring only in 2003.

My early years in OED were spent researching and writing about the oil industry in India. Despite the

fact that ONGC had made an oil discovery with Russian help in 1959, there was surprisingly little

written or known about the industry. And even less about the offshore oil exploration effort that ONGC now wanted to embark upon in the face of nervous bureaucrats in the ministry. I began writing articles in various newspapers on what needed to be done to build an offshore industry from scratch in the country. One was cheekily titled “Let’s churn the oceans.” …

We had continued to build our capability in offshore technology and our first breakthrough came when Indian Oil Corporation decided to build an offshore oil terminal at Salaya, on the west coast of India. This would be the first major offshore installation in the country for the import of oil, and I was

determined that OED should participate in its design and installation. In a meeting in the Planning

Commission, its managing director, C.R Dasgupta, proposed building the Single Buoy Mooring (SBM) terminal. I raised an objection stating that other alternatives – and I reeled out at least six other kinds of terminals --needed to be considered as well as plans made for appropriate transfer of technology to India before a decision could be made. Over Dasgupta’s objections, the planning minister entrusted EIL with evaluating the various options prior to a decision being made. 

We decided to bring in an international engineering company as a ‘back up consultant” to work with us. From that concept report grew the idea that OED should act as the consultants to IOC in the selection, design, fabrication and installation of the system, and thereby also ensure that the closely held technology in this area could be transferred to India. This was to be ourfirst major offshore job and I could now go out and hire additional staff. It was during this period that we bought equipment to create our own offshore field survey team under Anil Lyall, the wild-eyed hippie, hired Saeed Khan, a senior pipeline engineer working with a US company in Holland to oversee the

pipeline unit, and recruited structural engineers to start writing programs for design of offshore pipeline systems.

Soon our team was busy in carrying out surveys in theoffshore areas and in the design of the pipeline. The SBM was fabricated in Malta and our team was asked to supervise its fabrication and ensure its quality. NKK, a Japanese company, was responsible for the installation of the pipeline and the SBM system, but soon ran into problems due to the adverse weather conditions in the Gulf of Kutch. We were able to persuade them to bring in a more sophisticated installation vessel to complete the job. The offshore oil terminal was completed in time and we believed that we had made a breakthrough, and with that, other jobs would soon follow. Months of frustration followed as our main potential client, ONGC was unwilling to make any long-term commitments and indeed, wanted to develop this capability in house.

It was my belief that an important component in the success in the oil sector had to be the development of indigenous technological capability, preferably in a consulting company. .(But) I had to convince the government and ONGC of the merits of creating OEDin EIL as the engineering company for the country.

Even as we were making these arguments with thesenior management of ONGC and the government,

a minor incident occurred that could have easily sunk the OED before it had fully taken off. The

ONGC offshore jack up unit, Sagar Samrat, which was delivered in 1973, was to jack up at a location in offshore Bombay. To determine whether it was safe to do so, ONGC had appointed a French soil consulting company, TLM, to calculate the penetration that Sagar Samrat would have in the seabed. EIL had subcontracted with TLM to assist them in this projectand to learn in the process. This was one of our firstassignments with ONGC. TLM was using a measuring tool of their own-patented design and after field tests, had certified that the spot chosen by ONGC was safe.

But when Sagar Samrat started lowering its legs at that location, the penetration was considerably greater than what was predicted. ONGC staff, who had never really liked the idea of EIL meddling in their affairs, let out a howl saying, “We told you so, that EIL does not have the competence in offshore area and should be kept out.”

 I was then in Boston, finishing up my management program at Harvard Business School when I received a terse wire from Manmohan Pathak ordering me to return immediately. I returned in the midst of this furor and argued that the work done by TLM and EIL was only their subcontractor and if ONGC had any beef regarding technical competence, it should be with TLM and not EIL. Fortunately, Sagar Samrat had been moved a few thousand meters away and jacked up successfully by then and the furor died down. And when a few months later, the first exploration well turned out to be a discovery, perhaps the shift in location was a heaven sent gift, for this well led to the beginning of the Bombay High discovery and to the development of the OED team in EIL.

With the Sagar Samrat crisis behind us and the discovery of oil in Bombay High auguring well for a bright future for offshore oil production in India, I realized that we needed to build a strong,

interdisciplinary professional team in EIL for the challenges ahead. In building this capability, it was

clear to me that I needed to locate and bring to EIL the best Indian talent I could find from around the world, to form the core team around which the capability could be built. In all my journeys, I was therefore continually in search of Indians who had worked in the offshore area and had acquired experience and a reputation for brilliance. Another source of talent spotters were the professors at my old US universities, whom I had asked to keep a lookout for outstanding students. Professor Chopra at the University of California wrote to me of an outstanding student of his—Partho Chatterjee—who was just completing his doctorate and was keen to return to India. I interviewed the shy and gentle Partho and was impressed by his depth of knowledge, and recruited him to help strengthen our structural engineering department. Talent also came to us from within the company—there was Sushil Mathur, a piping expert, who was ambitious and enthusiastic, then Hari Kaul, a quiet, more down to earth electrical engineer, and Cheema, who was a port engineer, Dr Utpal Dutta, a process engineer who went on to become managing director of another private consulting company, and

others. What all of them had in common was their willingness to work hard, go fearlessly into new

areas and an innate brilliance that soon helped form a core team of impressive quality that could match any international team that came to work with us.

Our team soon had expertise in the entire gamut of technology required to work offshore; we had

physical and geological oceanographers, structural and pipeline engineers, process designers, electrical, mechanical and instrumentation engineers.

The main effort now was to quickly integrate them into a team, expose them to the best international

talent and to build a professional capability for all offshore work- from oceanographic and soil

investigations to the design of offshore pipelines and platforms. With the successful completion of the

offshore oil terminal, we had shown that offshore technology was no ‘black box’ accessible only to the international oil companies, but one that we could obtain and master. We had made a beginning. And in the next few years, I was determined that we would build a team in EIL that would master offshore oil technology and become the chief designer of all offshore installations in the country.