The long-drawn battle between British Gas and the Oil and Natural Gas Corporation over the operatorship of Panna, Mukta and Tapti oil and gas fields has been resolved with the contending parties agreeing to form a "common committee" to take decisions having major financial implications.

Under the "joint operatorship agreement" worked out recently, the post of the chief executive officer will be rotated among the joint venture partners. Each partner will hold it for two years.

"Broad modalities of the agreement have been worked out and the details of the final agreement are being looked into," a senior ONGC official told Business Standard in New Delhi on Sunday.

According to the broad framework of the agreement, the three offshore fields will be jointly operated by ONGC, the BG Group and the third partner, Reliance Industries, with the top post being rotated among them. The first CEO will come from ONGC.

A "common committee" of the three partners will be set up, which will deliberate on matters having major financial implications like award of contracts and purchase of materials and equipment.

It is learnt that board of directors of the BG Group will visit early next month and the joint operatorship agreement is likely to be signed before their visit.

BG, which had picked up Enron's 30 per cent stake in the three fields, was having problems with ONGC, which owns 40 per cent equity in the fields, and Reliance (30 per cent) over the operatorship issue. Earlier, Enron was the operator of the fields.

The British firm will be in charge of operations and technical services, while Reliance will look after finances and commercial interests of the joint venture. Procurements and contracts will fall under ONGC's responsibilities.

BG India Director Pravin Tandon said the partners would soon sign a formal agreement settling the issue.

The breakthrough came after ONGC refused to settle for anything less than joint operatorship and took strong exception to BG Group Chief Executive Frank Chapman flying to India to elicit support on a commercial agreement from senior ministers, officials said.

With Reliance backing it, the state-owned ONGC, which had discovered the Panna, Mukta and Tapti fields, threatened to remove BG as interim operator if it did not agree to joint operatorship.

BG, in December 2002, proposed involving ONGC and Reliance in awarding multi-million dollar contracts, including the proposed $800 million development plan to enhance output from the field, and subsequent negotiations saw hammering of the agreement, the officials said.

The joint venture is losing about Rs 1.5 crore a day by way of unrealised production potential. BG has, however, maintained that joint operatorships have been non-starters and delayed decision making.