The Hindu Business Line : Govt completes transfer of ISPRL to OIDB

The process of transfer of equity shares of IOC in ISPRL, a special purpose vehicle, to the Oil Industry Development Board (OIDB) was recently completed.

After the formal takeover, the first board meeting of ISPRL took place on May 9 under the Chairmanship of the Petroleum Secretary, Mr M.S. Srinivasan.

A roadmap has been laid for fixing targets for the projects, including setting a timeframe for completing the survey and acquiring land for building the storages, sources told Business Line.

It was also decided that board members would meet once a month to monitor the projects. The Government has identified two port cities to build three tanks to store emergency crude oil stocks of five million tonnes per annum (mtpa).

The selected sites are at Mangalore for 1.5 mtpa, Visakhapatnam for one mtpa, and another location near Mangalore for 2.5 mtpa.

While the actual cost of filling up the strategic crude oil storage would be based on the then prevailing international prices of crude, estimates are that setting up a five-mtpa reserve will cost around Rs 11,267 crore over nine years (including the cost of imported crude). The operational cost will be around Rs 90 crore annually.

As regards the structure of ISPRL, the sources said the board members are Mr Anil Razdan, Additional Secretary, Ministry of Petroleum and Natural Gas, Mr Prabh Das, Joint Secretary in the Ministry, and Mr B. Sam Bob, Secretary of OIDB.

The Chairman and Managing Director of Engineers India Ltd (EIL), Mr Mukesh Rohatgi, would be a special invitee.

Mr R.P. Pandey of IOC would continue to be CEO of the company, official sources said.

ISPRL's board members will include seven nominees of the OIDB, among others. The company's letter of association provides for 12 directors. An inter-Ministerial committee, headed by the Secretary in the Petroleum Ministry, will monitor the release or sale of strategic crude oil reserves.

IOC created ISPRL in 2004 with an equity infusion of Rs 1 crore.