In a significant step to enhance national energy security, India has decided to designate half of the Oil and Natural Gas Corporation's (ONGC) new 1.75 million-tonne petroleum storage facility in Mangaluru as a strategic petroleum reserve (SPR). The remaining capacity will be utilized for commercial operations, creating a dual-purpose infrastructure project.
Minister of State for Petroleum and Natural Gas, Suresh Gopi, recently confirmed this development in the Rajya Sabha. He emphasized that the ONGC-funded facility will play a crucial role in strengthening India's energy resilience against global supply disruptions, while also supporting commercial storage needs.
Mangaluru's New Dual-Purpose Facility
The upcoming Mangaluru storage complex, fully funded by ONGC, is designed with a total capacity of 1.75 million tonnes. Of this, 0.875 million tonnes will be specifically earmarked for India's strategic petroleum reserves. This addition is vital as the nation continuously assesses and expands its emergency crude oil stockpiles.
Current Strategic Reserve Landscape
Prior to this new allocation, India, through the Indian Strategic Petroleum Reserve Limited (ISPRL), had already established Phase-I strategic petroleum reserve facilities with a combined capacity of 5.33 million tonnes of crude oil. These include:
- Visakhapatnam: 1.33 million tonnes
- Mangaluru: 1.5 million tonnes
- Padur (Karnataka): 2.5 million tonnes
Beyond these underground reserves, India's broader energy infrastructure, encompassing offshore facilities, refineries, an extensive pipeline network exceeding 35,000 km, terminals, and above-ground storage tanks, collectively maintains a capacity equivalent to meet 74 days of its net crude import requirement.
Expansion and Future Plans
The government is actively pursuing further expansion of its strategic reserves. In July 2021, the Union Cabinet approved two additional commercial-cum-strategic petroleum reserve projects. These facilities, planned for Odisha and Karnataka, will add a combined storage capacity of 6.5 million tonnes, significantly boosting the nation's ability to withstand supply shocks. Minister Gopi reiterated that new locations for additional SPRs are under continuous assessment.
Why Strategic Reserves Are Critical
The importance of robust strategic petroleum reserves gained significant attention during the Strait of Hormuz crisis, which highlighted the vulnerabilities of global oil supply chains and the potential for price volatility. While India did not experience direct shortages during that period, the incident underscored the necessity for greater self-reliance in emergency crude stockpiles.
Former Planning Commission Deputy Chairman Montek Singh Ahluwalia has consistently advocated for India to build substantially larger strategic reserves under its direct control. He noted that while international reserves can help in global crises, India needs dedicated reserves to address potential crises that might specifically impact the country. Ahluwalia emphasized, “So, we need much larger Indian reserves under Indian control. And that basically means building up storage capacity in different parts of the country.”
This latest move to dedicate a portion of the Mangaluru facility reinforces India's commitment to enhancing its energy security and ensuring a stable supply of crude oil for its growing economy.