ONGC Approves 1.75 MMT Strategic Petroleum Reserve Expansion at Mangalore to Strengthen India’s Energy Security

10 Jul 2026 , 02:32 PM

India’s energy security strategy received a major boost after state-owned Oil and Natural Gas Corporation (ONGC) approved the development of a 1.75 million metric tonne (MMT) Strategic Petroleum Reserve (SPR) facility at Mangalore, Karnataka. The project, approved as an initiative of national importance, aims to strengthen India’s ability to withstand global crude oil supply disruptions and reduce vulnerability to international market volatility.

The proposed SPR expansion will significantly enhance India’s emergency crude storage capacity on the western coast and support the country’s long-term goal of building a robust energy security framework.

ONGC Board Gives In-Principle Approval for Mangalore SPR Project

The ONGC Board of Directors has granted in-principle approval for the development of the new strategic petroleum storage facility along with associated infrastructure. The project is expected to play a critical role in safeguarding India’s crude oil supply during periods of geopolitical uncertainty, conflicts, or unexpected disruptions in global energy markets.

ONGC plans to approach the government for necessary approvals and regulatory support to explore broader commercial utilisation opportunities for the proposed storage facility.

Mangalore Location Provides Strategic Advantage

The new SPR facility will be developed in Mangalore, Karnataka, a strategically important location on India’s western coastline. The region already houses major petroleum infrastructure, including refining facilities operated by ONGC’s subsidiary Mangalore Refinery and Petrochemicals Ltd. (MRPL).

The new storage capacity could potentially be integrated with MRPL’s operations, improving crude availability and strengthening supply chain efficiency for one of India’s major refining hubs.

MRPL operates a large-scale refinery in Karnataka with a capacity of approximately 300,000 barrels per day, making the Mangalore region a crucial centre for India’s petroleum sector.

New Reserve to Add Nearly 12.8 Million Barrels of Storage Capacity

The proposed 1.75 MMT Strategic Petroleum Reserve will add approximately 12.8 million barrels of crude oil storage capacity to India’s emergency reserves.

Currently, India’s strategic petroleum reserves have a total capacity of 5.33 MMT, distributed across three locations:

• Visakhapatnam, Andhra Pradesh: 1.33 MMT
• Mangalore, Karnataka: 1.5 MMT
• Padur, Karnataka: 2.5 MMT

The expansion will significantly improve India’s ability to maintain crude availability during supply shocks.

India’s Strategic Petroleum Reserve Expansion Plans

The Indian government has already approved additional SPR capacity of around 6.5 MMT as part of the second phase of strategic storage development.

The planned expansions include:

• Chandikhol, Odisha: 4 MMT capacity
• Padur Expansion, Karnataka: 2.5 MMT capacity

Together with ONGC’s proposed Mangalore project, these initiatives are expected to create a stronger national crude oil buffer.

Importance of Strategic Petroleum Reserves for India

India is among the world’s largest energy consumers and imports more than 85% of its crude oil requirements from international markets. This high import dependency makes strategic petroleum reserves essential for protecting the economy from sudden disruptions.

Existing strategic reserves currently provide coverage of only around eight days of national oil demand, highlighting the need for additional storage capacity.

The government has set an ambitious target of developing reserves of crude oil, liquefied natural gas (LNG), and liquefied petroleum gas (LPG) to cover nearly one month of domestic demand.

Investment and Economic Impact of ONGC’s SPR Expansion

The ONGC-led SPR expansion project is estimated to require an investment of approximately $1.6 billion. The development is expected to generate opportunities for companies involved in petroleum infrastructure, underground storage, engineering services, and logistics.

Improved crude storage capacity will also benefit domestic refiners by ensuring better access to crude supplies during periods of international market instability.

Potential Role of MRPL and Commercial Utilisation

ONGC may utilise the new storage caverns in coordination with MRPL, creating operational advantages for refining activities in Karnataka.

Beyond emergency stockpiling, ONGC is exploring possibilities for commercial utilisation of the facility. Such utilisation could help optimise storage capacity, improve crude trading flexibility, and strengthen India’s position in global energy markets.

ADNOC Partnership and International Energy Cooperation

India has been expanding partnerships with global energy producers to strengthen strategic crude storage arrangements.

The existing Mangalore SPR facility stores crude supplied by the Abu Dhabi National Oil Company (ADNOC) under an agreement with Indian Strategic Petroleum Reserves Ltd. (ISPRL).

India is also evaluating additional opportunities for foreign crude storage partnerships, including possible expansion of ADNOC-linked arrangements.

Strengthening India’s Long-Term Energy Security Strategy

The ONGC-approved Mangalore SPR expansion aligns with India’s broader objective of reducing exposure to global crude price fluctuations and supply disruptions.

As fuel consumption continues to rise due to economic growth, industrial expansion, and increasing transportation demand, building adequate energy reserves has become a key national priority.

The project represents a significant step toward creating a more resilient energy ecosystem by improving crude availability, strengthening infrastructure, and supporting India’s long-term energy independence goals.

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