Government to lease out 1 mn tonne crude oil reserve capacity

Wednesday 07th February 2024 05:33 EST

The Indian government has opted to lease out approximately 1 million tonnes of empty strategic crude oil storage capacity to both Indian and international firms instead of using public funds to fill the available space in the caverns. LR Jain, Managing Director of India Strategic Petroleum Reserves (ISPRL), revealed this decision. Initially, £500 mn was earmarked for FY24 to fill the vacant capacity in the underground caverns. However, the allocation was reduced to zero in the Interim Budget for FY25.

ISPRL, a petroleum ministry undertaking, has constructed underground crude oil storage facilities in Visakhapatnam, Mangalore and Padur (Karnataka) to store a total of 5.33 million tonnes for India's emergency needs. ADNOC has leased 1.25 million tonnes at Padur and 0.75 million tonnes at Mangalore out of the total available capacities.
ISPRL filled 1.25 million tonnes at Padur, leaving 0.75 million tonnes vacant in Mangalore and 0.25 million tonnes in Visakhapatnam. The empty capacity will be leased out, with ISPRL planning to invite expressions of interest soon, as stated by Jain at the India Energy Week in Goa.

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