Story
India's ONGC to Dedicate Half of New Oil Storage Facility to Strategic Reserve
India's state-run Oil and Natural Gas Corp (ONGC) will allocate half of its upcoming 1.75 million metric ton oil storage facility to the country's Strategic Petroleum Reserve (SPR), junior oil minister Suresh Gopi informed lawmakers on Monday. The new facility is part of a national strategy to bolster energy security by increasing emergency crude oil stockpiles.
Strategic Storage Expansion
ONGC, India's largest oil and gas producer, announced plans last month to construct the storage facility in Mangaluru, located in the state of Karnataka. The site will hold approximately 13 million barrels of crude oil and is situated near a 300,000 barrels-per-day refinery operated by its subsidiary, Mangalore Refinery and Petrochemicals (MRPL).
The decision to reserve half of this new capacity for the SPR underscores New Delhi's policy of expanding its strategic reserves with the involvement of the private sector. This model allows for commercial use of some SPR capacity, enhancing operational efficiency and investment appeal.
National Energy Security
India currently has a total SPR capacity of 5.33 million tons across three existing locations in the southern part of the country. These facilities are managed by the government-owned Indian Strategic Petroleum Reserves Ltd (ISPRL).
AdAccording to Gopi, India's total current crude oil and petroleum product inventories are sufficient to cover 74 days of the nation's net import requirements. This figure includes stocks held in refinery tanks, offshore facilities, and the country's extensive pipeline network.
Future Projects
India is planning further significant expansions to its strategic storage capabilities. These include two major projects to be developed with private partners:
- A 4 million ton facility at Chandikhol in Odisha state.
- A 2.5 million ton facility at Padur in southern India.
ISPRL has already acquired the land for the Chandikhol project, which has an estimated cost of 90 billion Indian rupees ($944.44 million), Gopi stated.
Read next
More on Commodities
U.S. Crude Inventories Post Surprise Draw While Gasoline Stocks Swell, EIA Reports
U.S. crude oil stockpiles fell unexpectedly last week, driven by a surge in exports, while gasoline inventories saw a significant build amid weakening demand, according to the latest EIA data.
UBS Raises Year-End Brent Forecast to $110 on Middle East Supply Risks
UBS has increased its year-end forecast for Brent crude to $110 per barrel, citing escalating supply risks in the Middle East, declining global inventories, and record-high freight costs.
Iran Dismisses Latest Qatari Peace Proposal as 'Unacceptable'
A senior Iranian official has rejected the latest Qatari-mediated draft deal to end the eight-month war, calling the ideas 'unacceptable' and signaling a continued diplomatic impasse. The news comes amid rising oil prices following attacks on Saudi energy infrastructure.
Argentina Poised to Gain EU Soymeal Market Share as Deforestation Rules Hit Brazil
Argentina's soybean industry is preparing to capture a larger share of the European Union's soymeal market as new EU anti-deforestation rules are expected to disrupt exports from rival Brazil.