Abu Dhabi/UAE: Indian Strategic Petroleum Reserves Ltd (ISPRL)signed today a Memorandum of Understanding (MoU) in Abu Dhabi with the Abu Dhabi National Oil Company (ADNOC) to explore the possibility of storing ADNOC crude oil at ISPRL’s underground oil storage facility at Padur in Karnataka, which has a 2.5 million tonne capacity. Under the MoU, ADNOC is expected to store crude in compartments at Padur.
The MoU with ISPRL, an Indian government-owned company mandated to store crude oil for emergency needs, follows the arrival, on November 4, of the final shipment of the initial delivery of ADNOC crude to be stored in another ISPRL underground facility at Mangalore, also in Karnataka, which will store 5.86 million barrels of ADNOC crude oil.
The MoU was signed by Abdulla Salem Al Dhaheri, Director of Marketing, Sales and Trading at ADNOC and Mr HPS Ahuja CEO & MD ISPRL on the sidelines of the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC). The signing was witnessed by H.E. Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, and Shri. Dharmendra Pradhan, Minister of Petroleum and Natural Gas & Skill Development and Entrepreneurship, Government of India.
On the occasion, H.E. Dr Al Jaber said “India is an important oil market and this agreement underscores the strategic energy partnership between the UAE and India that leverages the UAE and ADNOC’s expertise and oil resources. It is our firm hope that we will be able to convert this framework agreement into a new mutually beneficial partnership that will create opportunities for ADNOC to increase deliveries of high-quality crude oil to India's expanding energy market and helping India meet its growing energy demand and safeguard its energy security.”
ADNOC is the only foreign oil and gas company, so far, to invest by way of crude oil in India’s strategic petroleum reserves program.
Shri Dharmendra Pradhan said “This Memorandum of Understanding will allow ISPRL to explore, with ADNOC, opportunities related to the possible storage of ADNOC crude at Padur, which would help to significantly strengthen the country’s strategic petroleum reserves. This agreement reflects the strong bonds of cooperation between India and the UAE and provides a foundation for strengthening and expanding our strategic energy relationship.”
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), that can meet around 9.5 days of the country’s oil needs as per consumption data of last financial year. The government of India, in June 2018, announced the creation of two new reserves, a 4 million tonnes storage facility at Chandikhol in the eastern state of Odisha and an additional 2.5 million-tonne facility at Padur.
The existing and newly announced strategic reserve facilities put together will provide around 21 days of emergency coverage for India’s crude oil requirements.