Business Honor: Strategic Petroleum Reserve in Mangaluru

Strategic Petroleum Reserve: ONGC Pushes New Mangaluru Oil Storage

Storage

ONGC is advancing India’s strategic petroleum reserve with a new 1.75-MMT Mangaluru oil storage facility and Chandikhol moving into bidding.

NGC to build a 1.75-MMT Mangaluru oil storage facility split between strategic and commercial use.
Funding confirmed, but Mangaluru coverage is unclear for crude-only versus LPG/LNG.
Chandikhol strategic reserve in Odisha moves into bidding after land and draft documents.
Chandikhol is estimated at Rs 9,000 crore, with Odisha jobs and economic benefits expected.
India has 74 days’ crude import coverage, but shock-ready speed is the real test.

India’s strategic petroleum reserve is getting a fresh expansion push. The government told Parliament that State-owned ONGC would set up a 1.75-million-metric-tonne storage facility at Mangaluru in Karnataka, with half of the capacity earmarked for strategic needs and the rest kept for ONGC’s commercial operations.

It is energy security, but the Mangaluru oil storage facility is being framed as only partly strategic. If this is meant to be a national buffer against shocks, where exactly does it fit, resilience or flexibility?

In the Rajya Sabha, Minister of State for Petroleum and Natural Gas Suresh Gopi said the ONGC oil storage project would be fully funded by ONGC. The minister did not specify whether the facility will store only crude oil or whether it will also include liquefied petroleum gas and liquefied natural gas.

The update also covered the next major milestone for the strategic petroleum reserve on the eastern front. Work on the 4-MMT Chandikhol strategic reserve in Odisha has moved to the bidding stage, according to the government. Indian Strategic Petroleum Reserve Limited, the special purpose vehicle driving the programme, has acquired the land and registered it under its name. The draft Request for Proposal and Concession Agreement are now being finalized.

The Chandikhol strategic reserve is estimated to cost about Rs 9,000 crore and is expected to support Odisha’s GDP and related industries. The government also projected significant employment during construction and a smaller workforce during operations.

India already holds substantial storage across refineries, terminals, pipelines, and offshore options. Officials said the combined national capacity could meet about 74 days of net crude import requirement.

If India’s strategic petroleum reserve keeps expanding, the debate becomes clear. Build enough storage, or fix what makes disruptions hurt anyway. Business Honor asks will the new strategic petroleum reserve truly protect India faster when the next price and supply shock hits?