Oil and Natural Gas Corp. (ONGC), India's largest state-run explorer, plans to add strategic crude reserves by constructing underground facilities in the south of the country. Chairman Arun Kumar Singh said on Monday in New Delhi that the company will spend 70 billion rupees (approximately $736 million) on storage designed to hold about 13 million barrels. The site has been acquired, and construction is slated to start shortly.
The added capacity aligns with the government's effort to beef up emergency stockpiles after the Middle East conflict highlighted India's exposure to supply shocks stemming from high import dependence. India currently has roughly 39 million barrels in its strategic sites, equivalent to about one week of imports, far smaller than China's combined commercial and strategic inventories of 1.2 billion barrels.
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Separately, ONGC is in discussions with international partners to establish an overseas trading operation covering crude, refined fuels and natural gas to better manage procurement, sales and price exposure. Singh said the company is weighing Dubai and Singapore as potential bases, with a target to trade around 50 million tons annually.
