Abu Dhabi National Oil Company (Adnoc) has signed a memorandum of understanding (MoU) with the state-owned Indian Strategic Petroleum Reserves Limited (ISPRL) to explore the possibility of storing Adnoc crude oil at ISPRL’s oil storage facility at Padur in the southern Indian state of Karnataka.
The Padur facility comprises underground storage compartments with a total holding capacity of 2.5 million tonnes or 17 million barrels.
Under the MoU with India, Adnoc could store crude in two compartments at Padur.
Adnoc has already fulfilled its commitment of providing 5.86 million barrels of oil for another Indian crude storage facility in nearby Mangalore, as part of its first agreement with ISPRL signed in February.
The last shipment carrying Adnoc crude destined for the Mangalore facility arrived on the Arabian Sea coastal port on 4 November.
Adnoc is the only foreign oil and gas company, so far, to invest, by way of crude oil, in India’s strategic petroleum reserves programme, which ISPRL has been constituted to lead.
ISPRL has already built 5.33 million tonnes of underground storage capacity at three locations, Visakhapatnam (1.33 million tonnes), Mangalore (1.5 million tonnes) and Padur (2.5 million tonnes), as part of the first phase of building India’s strategic oil reserve that can meet around 10 days of the nation’s oil needs.
The Indian government in June announced the creation of two new reserves complexes, as part of the second phase of the reserves building exercise – a 4 million-tonnes storage facility at Chandikhol, in the eastern state of Odisha, and an additional 2.5 million-tonnes facility at Padur.
Combined, the existing and newly announced facilities will provide around 22 days of emergency coverage for India’s crude oil requirements.