Indian Strategic Petroleum Reserves, Aramco ink storage lease pact

Riyadh: India’s energy partnership with the world’s biggest oil producer - that will enable energy security in the long term took a leap forward on Tuesday, with a bilateral deal to build emergency crude reserves as a buffer against volatility in oil prices and supply disruptions. Indian Strategic Petroleum Reserves (ISPRL) signed an agreement with Saudi Aramco to lease part of the 2.5-million tonnes Padur storage in Karnataka.

The deal with the state-run Saudi Aramco was signed during Prime Minister Narendra Modi’s visit. The UAE has also contributed to strategic reserves in India. The Middle East unit of Indian Oil Corp, signed a preliminary deal with Saudi Arabia’s Al Jeri Transport Company for cooperation in the downstream sector, including setting up fuel stations in the kingdom.

Saudi Arabia has also expressed interest in picking up the government’s stake in Bharat Petroleum Corporation (BPCL), official sources said. Sources said Aramco is currently evaluating its Indian investments and views buying out BPCL as a good opportunity. “From a purely buyer-seller relationship, we are now moving toward a closer strategic partnership that will include Saudi investments in downstream oil and gas projects," Modi said in an interview to Arab News.