New Delhi, Nov 07: India will begin construction on storage facilities for 2.5 million tonnes of strategic crude oil reserves by April next year, Petroleum Secretary B K Chaturvedi has said. "We have approached the cabinet with a proposal to build strategic inventory of crude oil at Visakhapatnam and Mangalore in the first phase," Chaturvedi told reporters here.
The facilities, to be built in 18 months, would cost Rs 1,225 crore.
The Petroleum Ministry has also suggested to the cabinet that a third location on the west coast be identified so as to take the stockpile to 5 million tonnes (equivalent to 15 days cover) in the first phase.
Rajkot, a previous choice, has been dropped because of Defence Ministry’s objection on security considerations.
India imports 70 per cent of its 105 million tonnes of crude oil requirement every year and strategic storages are being planned as an insurance against disruption in supplies.
Though Chaturvedi did not give any more details, sources said the cabinet approval is being sought for state-run Indian Oil Corp (IOC) to float a new company which would build, import and maintain the crude oil stocks.
Bureau Report