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India might get crude for Padur facility from ADNOC

Mangaluru: On the occasion of delivering the first consignment of 2 million barrels of crude to Indian Strategic Petroleum Reserve’s Ltd. (ISPRL) at Mangaluru on Monday, the Abu Dhabi National Oil Company (ADNOC) indicated an interest to store crude at ISPRL’s Padur facility in Udupi district. Speaking to reporters, Marketing Director of ADNOC, Abdulla Salem Al Daheri said that the team was impressed with the facility in Padur and suggested that the company might store its crude in the facility.

This move will not only secure India’s energy reserves, but also strengthen strategic relations between India and the United Arab Emirates (UAE). During Prime Minister Narendra Modi’s visit to the UAE in February, the ADNOC had agreed to store 5.86 million barrels of crude at the facility in Mangaluru and the ISPRL had signed an agreement with the ADNOC. The first consignment was despatched through Very Large Crude Carrier (VLCC) MT Inspiration from ADNOC on May 12, in the presence of Union Petroleum Minister Dharmendra Pradhan. It reached Mangaluru on Monday.

Based on the agreement, India can use the entire crude on pre-agreed prices, in case of any emergency. The ADNOC can also sell a percentage of the crude to Indian refineries without affecting the emergency storage. India will not have to bear any expense of the crude until it makes use of it. India has three Strategic Petroleum Reserves- in Visakhapatnam (1.33 million tonnes), Mangaluru (1.5 million tonnes) and Padur (2.5 million tonnes) in Phase 1. ADNOC will be delivering another two consignments through VLCCs to Mangaluru after the monsoons.

Sunjay Sudhir, Joint Secretary (International Relations), Union Petroleum Ministry, informed that the government has planned to add another 6.5 million tonne capacity to the existing ISPRL under Phase 2, wherein the Padur facility might get an additional 2.5 million tonne SPR. He said that the consignment delivery had forged a strategic relationship between the UAE and India. He also thanked the Karnataka government for waiving VAT and entry tax for ISPRL’s crude. The present storage capacity of ISPRL ensures 30 days of steady fuel if it does not get overseas crude.

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