The government has announced its plans to lease a portion of its Strategic Petroleum Reserve capacity to private oil companies for commercial utilisation of the storage space. 

India currently maintains strategic crude storage facilities in three locations - at Mangalore and Padur in Karnataka, and Visakhapatnam in Andhra Pradesh. These facilities collectively have a capacity of five million tonne.

As per regulations, a portion of these storage facilities can be leased to oil companies, while ensuring that the government retains the right to access crude from these reserves in case of an emergency.

Indian Strategic Petroleum Reserve (ISPRL), the entity responsible for managing the reserve, will soon initiate the process of inviting expressions of interest (EoIs) from energy companies. As per ISPRL, approx. 0.75 MMT of capacity in Mangalore and about 0.25 MMT in Visakhapatnam are presently vacant and in need of filling.

The decision comes after the Budget eliminated a Rs 5,000-crore plan aimed at purchasing crude oil to fill the reserve.