The Ministry of Petroleum and Natural Gas has initiated roadshows to seek interest from private companies willing to build the next phase of strategic crude oil reserves.

Speaking at the event, Minister for Petroleum and Natural Gas, Dharmendra Pradhan, said, “The demand for petroleum products has been increasing at a compounded annual growth rate of 5.5 per cent from 2013 to 2017. Our domestic production will be unable to meet the ever increasing domestic demand of petroleum fuels and petrochemicals and India will continue to depend on imports in the foreseeable future.”

“The Indian Strategic Petroleum Reserves Ltd (ISPRL) was formed to meet India’s energy security. To further improve strategic reserve, the Cabinet granted approval for establishing additional 6.5 million tonne of strategic petroleum reserve which will be able to provide extra 12 days of supply,” Pradhan said.

“Chandikhol in Odisha and Padur in Karnataka have been selected as the optimum location for these strategic petroleum reserves.”

“The 12 days of additional storage will add to the 10 days of reserves achieved in Phase I. Indian refiners maintain 65 days of crude storage, and when added to the storage planned and achieved by ISPRL, takes the crude storage tally to 87 days. This is very close to the storage of 90 days mandated by IEA for member-countries,” Pradhan said.

HPS Ahuja, CEO & Managing Director ISPRL, had told BusinessLine: “The caverns to be built during the next round of the strategic petroleum reserve programme will be done on public-private-partnership model. Rights for developing will go to the bidder that offers a higher share of the crude oil stored.”.

ISPRL proposes to initially test the water and hold roadshows to see private sector interest in the projects. The terms and conditions of such participation will be determined by the Petroleum Ministry in consultation with the Finance Ministry after the roadshows.

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