Phase-II of strategic oil reserve plan to take off from Odisha: Pradhan

Pradhan said the state-of-the-art Paradip refinery of IOCL, with a capacity to process 15 mn tonne of crude oil and built at a cost of about Rs 35,000 crore, will go on stream by the end of Jan 2016

Taking advantage of the falling prices of oil, the Union ministry of oil and natural gas plans to set up a strategic oil reserve facility in Odisha to store oil for future use.

“In the first phase, strategic oil reserve facilities have been created in Andhra Pradesh and Karnataka. The second phase of strategic reserve will start from Odisha at Chandikhole. Very soon, I am going to the Cabinet for approval. In this year’s Union Budget, we may get some money to start work on the project,” said Dharmendra Pradhan, Union minister for oil and natural gas at the valedictory session of Business Standard Odisha Round Table -2015.

“India does not want to miss the bus with oil prices crashing down. We want to create more reserve capacity to store the cheap oil in our country,” he added.

According to Pradhan, the state-of-the-art Paradip refinery of Indian Oil Corporation, with a capacity to process 15 million tonnes of crude oil and built at a cost of Rs 35,000 crore, will go on stream by the end of January.

“The Prime Minister will dedicate the refinery to the nation very soon, probably in the last week of January. This will be the biggest ever public sector undertaking-run refinery in the country with the complex configuration to refine all kinds of oils — be it Latin American heavy oil, high sulphur African oil or Gulf crude oil,” he said.

Another Rs 30,000-40,000 crore will be spent by Indian Oil on the proposed petro-chemical complex at Paradip. Both the Odisha government and the Centre are actively planning to create a petrochemical hub, which would house downstream industries,  creating jobs and bringing in revenues, Pradhan said. His ministry has set an ambitious target of spending Rs 1 lakh crore in the oil & gas sector in the state.

Stating that Odisha could be the future hub for natural gas in the country, he said gas reserves to the tune of 2 trillion cubic feet have been located in the Mahanadi basin along the Odisha coast. As the blocks are located in deep sea, the government is waiting for cost-effective technology to tap them.

The government also plans to tap coal-based methane gas available in the state. It has set up a liquefied natural gas terminal in the east coast at Dhamra in Bhadrak district. Odisha will be a unique state to have two major pipelines running — Paradip-Dhamra-Surat and Haldia-Jagdishpur.

Pradhan said he was working on a plan to push household liquefied petroleum gas penetration in Odisha to 70 per cent from the current 30 per cent over the next three years.