India plans to develop the second phase of its strategic petroleum reserve (SPR) programme at an estimated cost of Rs 14,527 crore through a public-private partnership (PPP) model. The government seeks to strengthen energy security and reduce risks from global supply disruptions. The expansion, approved in July 2021, will add 6.5 million tonnes of commercial-cum-strategic crude oil storage capacity through two new facilities in Odisha and Karnataka.
The project will receive government viability gap funding (VGF) of up to 60 per cent of the total project cost. According to a written reply by Minister of State for Petroleum and Natural Gas Suresh Gopi in the Lok Sabha, the Odisha facility will have a capacity of 4 million tonnes. Another facility in Karnataka will add 2.5 million tonnes.
Energy Diversification Efforts Continue
Under the first phase of the SPR programme, India established storage facilities with a combined capacity of 5.33 million tonnes at Visakhapatnam, Mangaluru and Padur through Indian Strategic Petroleum Reserve Ltd (ISPRL). These facilities were commissioned between 2016 and 2018.
The government is also assessing additional locations for future strategic petroleum reserves as part of efforts to strengthen India’s energy security. It has also allowed Abu Dhabi National Oil Company (ADNOC) to use a 750,000-tonne cavern at the Mangaluru facility.
The government said India has expanded its crude oil sourcing network from 27 countries to 41 countries. LNG sourcing has increased from six countries to 15 countries. This diversification is aimed at reducing dependence on specific suppliers and improving resilience against global supply disruptions.
The government is also promoting alternative fuels such as CNG, PNG, ethanol, compressed biogas and biodiesel. Measures to increase domestic oil and gas production and reduce crude import dependence are also being considered. |
