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India, the world’s third-largest oil importer, is inviting foreign energy companies to invest in its projects to expand its strategic petroleum reserve capabilities, Indian Oil Minister Dharmendra Pradhan said on Monday.
“I invite global energy players to come and invest in this project,” Pradhan said, as carried by Reuters, at the virtual ADIPEC industry conference, referring to India’s ongoing construction of additional commercial and strategic petroleum storage.
Earlier this year, India used the ultra-low crude oil prices to top its strategic petroleum reserves with oil at $19 a barrel, saving nearly US$700 million in the process, India’s Ministry of Petroleum and Natural Gas said in September.
“Taking advantage of the low crude oil prices in international market, India purchased 16.71 million barrels (mbbl) of crude in April – May, 2020 and filled all the three Strategic Petroleum Reserves created at Vishakhapatnam, Mangalore and Padur,” Pradhan said.
The average cost at which India bought the crude oil in April and May was $19 per barrel, compared to $60 a barrel oil price in January 2020. Thanks to the cheapest oil in years at the start of the second quarter, India saved US$685.11 million on its crude oil import bill, the ministry said.
India, which is expected to be the key energy growth driver in the world and a main source of oil demand growth in the coming decades, is now looking to expand its petroleum reserves capacity as it looks to boost its energy security and forge closer commercial ties with major energy companies.
Last month, India allowed Abu Dhabi National Oil Company (ADNOC) to export oil from an Indian storage site, part of which the UAE firm had leased for its oil. This was a shift from India’s policies that do not allow oil sales to non-Indian refiners.
India’s primary energy consumption is set to more than double by 2050 under all three scenarios BP has projected in its latest Energy Outlook 2020.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com