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Abu Dhabi Co to store crude oil at Mangalore

Press Trust of India  |  New Delhi 

Company (ADNOC) has signed an agreement to store about 6 million barrels of at India's reserve.

The agreement to store at the underground caverns was signed on Saturday during the visit of to Abu Dhabi, a statement issued by Indian Strategic Reserves Ltd (ISPRL) said.

The pact, which was signed by HPS Ahuja, & MD, ISPRL and Abdulla Salem Al Dhaheri, Director Marketing, Sales and Trading, ADNOC, envisages storage of 5.86 million barrels of crude by the UAE firm in the underground storage cavern.

ADNOC had last year given up its crude storage lease in and instead agreed to store oil at in a bid to establish ground presence in world's third largest oil consuming nation.

Out of the crude stored, a part would be used for commercial purposes by ADNOC, while a major part would be purely for strategic purposes.

ISPRL has built around 39 million barrels (5.33 million tonnes) of strategic crude at three locations -- Padur and on the western coast and Visakhapatnam on the eastern coast.

The oil stored in the underground rock caverns at the three locations are to be used in an emergency.

The Strategic Reserves (SPR) at Mangalore consists of two compartments with a total storage capacity of 1.5 million tonnes (11 million barrels), the statement said.

While one compartment has been filled with through funds made available by the government, the other compartment will be filled by crude supplied by ADNOC, the statement said.

"The facility will help boost India's security, as well as enable ADNOC to efficiently and competitively meet market demand in and across the fast-developing southeast Asian economies." it added.

imports over 80 per cent of its crude oil needs, out of which about 8 per cent is supplied by the UAE.

ADNOC hired the Mangalore storage just as it ended a contract to store 6 million barrels of crude oil at Korea National Oil Corp's Yeosu facility in the country's southwest coast.

had first right over the oil in the event of a supply emergency.

While the Vishakhapatnam storage of ISPRL has a capacity of 1.33 million tonnes (9.77 million barrels) of crude oil, Padur can stock 2.5 million tonnes (18.37 million barrels).

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, February 12 2018. 17:55 IST