ONGC announced the development in a stock exchange filing late Thursday. The move comes after India, the world’s third-largest oil importer and consumer, faced significant energy security concerns following the blockade of the Strait of Hormuz after Israel and the United States launched attacks on Iran. Nearly one-fifth of global energy supplies pass through the strategic waterway.
To enhance its emergency preparedness, India is expanding energy cooperation with countries including the United Arab Emirates and Japan to strengthen its strategic crude oil reserves. ONGC said it would seek approval from the federal government for commercial use of the new storage facility in the national interest.
India currently permits commercial use of a portion of its strategic petroleum storage facilities located at Mangalore, Padur, and Vizag in southern India. These facilities have a combined crude oil storage capacity of up to 5.33 million metric tons and are managed by the government-owned Indian Strategic Petroleum Reserves Ltd.
Mangalore Refinery and Petrochemicals Ltd, an ONGC subsidiary, operates a 300,000 barrel-per-day refinery in Mangalore. The company has already leased half of the existing 1.5 million metric ton Mangalore strategic petroleum reserve, while the remaining capacity has been leased to Abu Dhabi National Oil Company of the United Arab Emirates.
During Prime Minister Narendra Modi’s visit to the United Arab Emirates earlier this year, Abu Dhabi National Oil Company announced plans to increase crude oil storage capacity in India to up to 30 million barrels.
The company also announced that the United Arab Emirates would explore potential crude oil storage opportunities at Fujairah as part of India’s strategic reserve expansion plans.
India is additionally planning to construct a 4 million metric ton strategic petroleum storage facility at Chandikhol in Odisha and a new 2.5 million metric ton facility at Padur in southern India.
The expansion of strategic petroleum reserves marks a major step in India’s efforts to secure energy supplies, reduce vulnerability to international disruptions, and strengthen long-term energy resilience.
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