(ET)
India will lease a quarter of its strategic petroleum reserve in Padur to Saudi Aramco to store about 4.6 million barrels of oil, a government official said on Wednesday, as New Delhi seeks global investment in its expanding energy infrastructure.
Global oil producers are eager to gain a foothold in India, where fuel demand is expected to keep rising as the country’s economy grows. Indian Strategic Petroleum Reserves Ltd, a government company charged with building oil storage, signed a memorandum of understanding with the Saudi state firm for its participation in the 2.5-million-tonne facility in Karnataka state. “Aramco has signed an MoU for only one compartment,” said HPS Ahuja, chief executive of the Indian company.
The Padur storage facility has four equal-sized compartments. So far, Abu Dhabi National Oil Co is the only foreign company storing oil in India’s strategic reserves, at Mangalore, also in Karnataka. Last year it signed a preliminary agreement to use half of the Padur reserve.
