India has captured the attention of major international oil and commodity trading firms. With names like BP, Shell, and PetroChina showing keen interest, the country’s ambitious Strategic Petroleum Reserve (SPR) project has gained momentum. The argusmedia news.
- Major global firms, including BP, Shell, and PetroChina, express interest in building India’s new Strategic Petroleum Reserve.
- India’s phase two SPR project aims to boost capacity to 11.83mn tons, securing over 18 days of crude oil cover.
- The Indian government allocates $604mn in its budget for 2023-2024 to fortify the nation’s energy resilience through strategic oil storage.
Strong Interest from International Players
Several prominent global oil and commodity trading firms have demonstrated keen interest in participating in the construction of India’s new Strategic Petroleum Reserve (SPR). Among the notable names are BP, Shell, PetroChina, Trafigura, Vitol, and Glencore, among others. This enthusiasm was revealed during two roadshows organized by the Indian government, as disclosed by Minister of State for Petroleum and Natural Gas, Rameswar Teli, in the lower house of parliament on August 3rd.
Expansion Plans
India’s ambitious phase two of the Strategic Petroleum Reserve project is gaining momentum with the involvement of international industry giants. The government’s efforts to attract investment were evident as early as October 2018, when roadshows were launched to draw in potential investors. This expansion phase involves the creation of a 6.5 million ton (47.6 million barrel) reserve. Notable locations include Chandikhol in Odisha state and Padur in Karnataka, to be developed under a public-private partnership. Once completed, this phase will significantly bolster India’s strategic oil storage capacity, reaching a total of 11.83 million tons.
Meeting Energy Security Needs
India’s escalating energy demands and the volatility of global oil markets have spurred the country to prioritize its energy security through comprehensive strategic planning. With an annual crude oil import volume of 4.67 million barrels per day during the fiscal year from April 2022 to March 2023, having an SPR capacity of 11.83 million tons translates to over 18 days’ worth of coverage. This enhanced capacity ensures that India can better weather disruptions in global oil supply.
Budget Allocation and Government Involvement
In line with its commitment to secure energy resources and strengthen its energy infrastructure, the Indian government has allocated 50 billion rupees ($604 million) in its budget for the fiscal year from April 2023 to March 2024. This substantial allocation reflects the government’s determination to enhance its Strategic Petroleum Reserve capabilities. Additionally, the government’s proactive approach grants it the prerogative to withdraw crude from the SPR in times of shortages, ensuring a more stable energy supply for the nation.
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Source-argusmedia
