India aims for first strategic petroleum reserve with a private company by 2029-30

Apr3,2024



New Delhi – India is planning to build its first privately managed building strategic petroleum reserves (SPR) by 2029-30, giving the operator the freedom to trade all stored oil, the Chief Executive of Indian Strategic Petroleum Reserves Limited ,ISPRL) Said.
Allowing fully commercial SPR mirrors the model adopted by countries such as Japan and South Korea, which allow private lessees, mostly oil majors, to trade crude.
So far, India has allowed only partial commercialization for its three existing SPRs in southern India, which have a combined capacity of 36.7 million barrels.
India is planning to build two new SPRs – first an 18.3 million barrel cavern in Padur in southern Karnataka state, and then a 29.3 million barrel SPR in eastern Odisha state – allowing private partners to trade all the oil locally. Will happen.
ISPRL Chief Executive LR Jain said that in case of shortage, the government will have the first right on oil.
Jain said ISPRL, which is responsible for managing India's SPR, had last month issued a tender to gauge interest among local and global companies for the Padur SPR.
“We expect the tender to be awarded on design, build, finance, operate and transfer basis by September and the SPR should be completed in 60 months from zero data,” Jain told reporters at an industry event.
India, the world's third largest oil importer and consumers, willing to expand SPR capability To protect against global supply disruptions and price increases.
Expansion oil storage capacity This will also help India join the International Energy Agency (IEA), whose members are required to have a minimum of 90 days of oil consumption.
The IEA had said in February that India's oil reserves, including SPR quantities, were enough to meet about 66 days of consumption.
ISPRL estimates the Padur SPR and linked pipeline and oil import facility to cost around Rs 55 billion ($659 million), Jain said, with the federal government providing up to 60% of the total.
He said the bidder that required the lowest federal financing or paid the highest premium for a 60-year lease would be awarded the rights to the SPR.



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