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India Boosts Oil Reserves Amidst Geopolitical Tensions
19 Jun
Summary
- New underground oil reserve to store 1.75 million metric tonnes.
- ONGC to spearhead development with estimated ₹15,000 crore investment.
- Government aims to counter vulnerability to global oil supply shocks.
India is set to significantly bolster its energy security with the development of a new strategic petroleum reserve (SPR) facility. The project, spearheaded by Oil and Natural Gas Corp (ONGC), will feature an underground cavern in Mangaluru capable of storing 1.75 million metric tonnes of crude oil.
This new reserve, expected to cost around ₹15,000 crore, will increase India's existing crude storage capacity by nearly one-third. The government's initiative is a direct response to vulnerabilities exposed by recent geopolitical conflicts, highlighting the need for enhanced preparedness against potential supply shocks.
Historically, India's SPR projects have been government-funded and managed by ISPRL. However, this new facility marks a potential shift, with ONGC owning the land and taking the lead. The financial viability and revenue generation model for the facility are still under consideration.
India's current strategic reserve capacity of approximately 5.33 million tonnes is considered modest compared to global energy giants like China and the United States. This expansion aims to rectify that imbalance, ensuring greater resilience in its energy supply chain.
