Aramco, Shell, ADNOC eye Indian crude storage
According to reports, crude imports from the UAE are expected to rise to 18.5mn tonnes in 2016-17.
Oil majors Saudi Aramco, Shell and ADNOC are interested in hiring capacity in India's strategic crude storages, oil minister Dharmendra Pradhan told the media last week.
"ADNOC of UAE, Saudi Aramco of Saudi Arabia and Anglo-Dutch Shell have expressed their interest in storing crude oil in the strategic petroleum reserve facilities," Pradhan told the media.
According to reports, crude imports from the UAE are expected to rise to 18.5mn tonnes in 2016-17. Broad contours of discussion with ADNOC indicate the Abu Dhabi firm is envisaged to store 1.5mn tonne oil at the Mangalore storage facility. Initially, ADNOC may be allowed to fill 0.75mn tonne, half of which may be made available to India as storage fee.
Pradhan said in the first phase, underground crude storage capacity of 5.3mn tonne has been created at Visakhapatnam (1.3mn tonne), Mangalore (1.5mn tonne) and Padur (2.5mn tonne) utilising rock caverns.
"The Visakhapatnam and Mangalore storage facilities have already been commissioned. The facility at Visakhapatnam has already been filled up and nearly one-fourth of Mangalore storage facility has also been filled. The storage facility at Padur has also been completed," he said.
These reserves as well as crude stored in tanks at refineries and pipelines are enough to meet 73 days of India's oil requirement. The government has exempted overseas oil companies from income-tax liability on sale of their crude stored in the strategic storage.
Imports meet 80% of its crude requirement and the storages are being built as a cushion against sudden supply disruption due to geopolitical incidents or natural calamities.