ONGC To Reserve Half Of Planned Oil Storage Facility For Strategic Needs

Half of the 1.75 million metric ton oil storage facility being built by Oil and Natural Gas Corp (ONGC) will be earmarked for India's strategic petroleum needs, junior oil minister Suresh Gopi informed Parliament on Monday. The facility can hold roughly 13 million barrels of crude.

ONGC had announced plans last month to set up the reserve at Mangaluru in Karnataka. The location houses a refinery run by its subsidiary, Mangalore Refinery and Petrochemicals (MRPL), which has a processing capacity of 300,000 barrels per day. According to Gopi, MRPL has already leased out half of the proposed 1.5 million ton storage unit at the site.

Private Sector Now Part Of The Plan

India has opened up its Strategic Petroleum Reserve (SPR) programme to private companies as it looks to grow storage capacity. Currently, existing SPR facilities located at Mangaluru, Padur and Vizag together hold 5.33 million tons, and Indian rules permit a portion of this to be used commercially. The Indian Strategic Petroleum Reserves Ltd (ISPRL), a state-owned entity, oversees these sites.

Gopi told lawmakers that India's overall storage network, spanning refinery tanks, offshore units and a 35,000 km pipeline system, can currently cover 74 days of the country's net crude import requirement.

Two additional projects are in the works. A 4 million ton storage facility is planned at Chandikhol in Odisha, while a separate 2.5 million ton unit will come up at Padur, both to be developed alongside private partners, Gopi said.

Land acquisition for the Chandikhol project has already been completed by ISPRL, he added. The project is expected to cost around 90 billion Indian rupees, or approximately $944.44 million.