NEW DELHI • India is seeking investment from Saudi Arabia to build emergency crude reserves that will act as a buffer against volatility in oil prices and supply disruptions for the third-largest oil consumer.
Saudi’s participation in the Indian Strategic Petroleum Reserve programme was discussed at a meeting between the kingdom’s Energy Minister Khalid Al-Falih and his Indian counterpart Dharmendra Pradhan in New Delhi on Saturday, according to a government statement yesterday.
They also discussed expediting a proposed US$44 billion (RM179.83 billion) oil refinery project on India’s west coast with investment from Saudi Arabian National Oil Co, it said.
Prime Minister Narendra Modi has opened some of the underground caverns for commercial storage to lessen the strain on state finances.
It has already leased out tanks to Abu Dhabi National Oil Co.
India has already built 5.33 million tonnes of underground reserves in three locations, which can meet 9.5 days of the country’s oil needs.
It now plans two new reserves with a combined capacity of 6.5 million tonnes, sufficient to cover an additional 12 days.
Saudi Arabia is a key oil suppl ier to India and exported 36.8 million tonnes of crude to Indian refiners in the year ended March 2018, accounting for 16.7% of thei r total purchases, according to the statement. — Bloomberg