Mangaluru caverns ready for more crude oil

M Ramesh Chennai | Updated on January 17, 2018


Will have capacity to store 11 million barrels

The caverns are ready and they are waiting only for the rains to cease.

The government-owned Indian Strategic Petroleum Reserves Ltd (ISPRL) is ready to fill the just-built underground rock-cut caverns near Mangaluru with crude oil.

“It will be filled as soon as the single point mooring facilities become available,” says Rajan Pillai, CEO and Managing Director, ISPRL. The SPM, which is a loading buoy anchored offshore, is currently unavailable because of the monsoon.

The Mangaluru caverns – many tunnels totalling 8.9 km in length – took ₹1,227 crore to build. Engineers India Ltd did the project with help from Geostock of France, which is engaged in similar business.

The Mangaluru caverns will have capacity to store 1.5 million tonnes (11 million barrels) of oil, valued at ₹51 crore at today’s prices. These caverns will be the second of the three caverns that ISPRL is building to hold India’s strategic oil reserves, with an investment of ₹4,098.35 crore. The first was a 1.3-million-tonne project at Visakhapatnam, which was filled last year.

The third is at Padur, near Mangaluru, which are almost ready for commissioning.

The Padur caverns are the biggest of the three, with six galleries of a total length of 13.5 km, and can hold 2.5 million tonnes (18.25 million barrels) of crude. Padur consumed ₹1,693 crore of investments.

Cost factor

A few other countries such as the US, China, Korea and Japan, have underground storage caverns, but Pillai says that India was able to do at a fraction of the cost of other countries.

For instance, the Japanese costs work out to $368 per kilo litre of crude oil, compared with India’s $93.

In the second phase, which is awaiting government approval, ISPRL will build another 12.5 million tonnes of storage space, with more caverns at Padur, Chandikhol (Odisha), Bikaner (Rajasthan) and Rajkot (Gujarat). Chandikhol is likely to be underground concrete tanks. Bikaner is likely to be the cheapest to build. The region has mountains of salt underground. Pump in water, dissolve the salt, drain the water out and you get a cavern.

Published on August 18, 2016

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