A$00051$

I$[]$I IVI Indian Institute of Management Ahmedabad

March $31,2016$

OIL: Installation of a Central Gas Gathering Station at Madhuban, Assam

Achintya Kumar Nath, Head$-$Production of Gas $($Field & Production$)$ was in charge of the company's latest project $-$ the installation of a Gas Gathering Station at Madhuban, a site in Dibrugarh, Assam, a state in the northeast of India, in December $2014.$ He was happy that the project had come to an end. However, he was somewhat disappointed that it had taken longer than expected to complete the project. He wondered if this was because it was the first major project that Oil India had handled.

THE HISTORY OF OIL DRILLING IN INDIA ${?}^1$

Crude oil was first found in India during $1889$ near Digboi in Assam. Digboi was the oldest of all the continuously producing oilfields in the world. According to people at Oil India, Digboi was not just another oilfield, but an oil museum with a history to be proud of$.$

Assam has a special place in the history of oil drilling. Lieutenant R Wilcox of the $46$th regiment of native infantry of the armed forces of the United Kingdom $($UK$)$ saw oil rising to the ground level at Supkhong, Assam, with a great bubbling of gas and green petroleum. During British rule in India, Burmah Oil was the first British company to extract oil in India.

OIL INDIA LIMITED

After independence, the government of India wanted to emphasise economic growth and thought that the public sector was the best method of creating economic growth. The GOI created several large public sector companies in steel, oil and gas, power and heavy engineering, electrical equipment and coal. On February $18,1959,$ Oil India Private Limited was incorporated. In $1961,$ it became a joint venture company between the Indian Government and Burmah Oil Company Limited, UK$.$ OIL explored the oil fields in Bangladesh, India and Burma. OIL was an international company with a presence in Bangladesh, Myanmar, Russia, Yemen, Libya, Nigeria, Gabon, Mozambique, Venezuela and the USA. Despite its international presence, OIL's operations were confined mainly to India $($Exhibit $1).$ The growth of the comnanv over the last $50$ vears is nrovided in Fxhihit $2$ and the financial details of OII are