India, which is 79 per cent dependent on imports to meet its crude oil needs, is building underground storages at Visakhapatnam, Andhra Pradesh and Mangalore, and Padur, in Karnataka to store about 5.33 million tonnes of crude oil, which is enough to meet its oil requirement for 13-14 days.
"The storage at Visakhapatnam is expected to be commissioned in January 2014," the Oil Minister said.
The Visakhapatnam facility would have the capacity to store 1.33 million tonnes of crude oil in underground rock caverns. Huge underground cavities, almost 10 storey tall and approximately 3.3 km long are being built.
A similar facility in Mangalore will have a capacity of 1.55 million tonnes and would be mechanically completed by March 2014. A 2.5-million tonnes stor age at Padur, near Mangalore, would be completed by end of current fiscal year, he said.
With the commissioning of this storage at Visakhapatnam, India will join nations like Japan, China and the US, which have strategic reserves. These counties use the stockpiles not only as insurance against supply disruptions but also to buy and store oil when prices are low and release them to refiners when there is a spike in global rates.
Originally, India Strategic Petroleum Reserves Ltd (ISPRL), the state-owned firm building the strategic stockpile, was to build the Visakhapatnam facility by October 2011, while the Mangalore storages were to be mechanically completed by November 2012. The storage at Padur was scheduled for completion in December, 2012.
"Visakhapatnam storage is 94.6 per cent complete, Mangalore is 89.2 per cent and Padur is 86 per cent complete," Mr Moily said.
The Cabinet had in January 2006 approved building of the strategic crude oil storag es at a cost of Rs 2,397 crore but due to cost and time overrun the capital required is now estimated at Rs 3,958 crore.
The Visakhapatnam facility will cost Rs 1,038 crore, Mangalore Rs 1,227 crore and Padur Rs 1,693 crore.
ISPRL has till date received Rs 2,529 crore from Oil Industry Development Board (OIDB) and Rs 100 crore from Hindustan Petroleum Corp Ltd (HPCL), officials said. They also said the firm required Rs 1,195 crore either from OIDB or the government to complete the projects.
ISPRIL would need Rs 490 crore in the current fiscal year and Rs 705 crore in the next, they said.
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