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Strategic Petroleum Reserves of India

November 17, 2018

Strategic Petroleum Reserves of India

In 1990, during the Gulf war India was in the brinks of a major energy crisis as nation had oil reserves for only three days. While India managed to avert the crisis then, the threat of energy disruption continues to present a real danger even today. To address energy insecurity, the Atal Bihari Vajpayee government mooted the concept of strategic petroleum reserves in 1998. India’s strategic oil reserve project was mooted in 1998 and commissioned in 2003. After extensive land acquisitions and tackling site suitability, security and design-related issues, it was only in February 2015, the country began filling up a strategic storage facility. The Vision 2020 envisages SPR for 90 days of imports, conservatively pegged at almost 360 million barrels of oil, according to 2014 figures.

 To ensure energy security, the Government of India had decided to set up 5 million metric tons (MMT) of strategic crude oil storages at three locations namely, Visakhapatnam, Mangalore and Padur (near Udupi). These strategic storages would be in addition to the existing storages of crude oil and petroleum products with the oil companies and would serve as a cushion during any external supply disruptions. When fully filled, these reserves would be equivalent to 13 days of oil imports. The government is targeting an increase to 90 days of imports by 2020. Globally, the US has the maximum storage facility, which can last for about 90 days.

The construction of the Strategic Crude Oil Storage facilities is being managed by Indian Strategic Petroleum Reserves Limited (ISPRL), a Special Purpose Vehicle, which is a wholly owned subsidiary of Oil Industry Development Board (OIDB) under the Ministry of Petroleum & Natural Gas.

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