India is seeking private investors to develop and manage its largest strategic petroleum reserve (SPR) site, a project valued at $910 million. The facility, located in Chandikhol, Odisha, will hold up to 4 million tons of crude oil, significantly boosting the country’s SPR capacity by 80%. The Indian government is offering a $546 million grant to encourage private investment in the project.
Bids for the project must be submitted by February 26, 2027, according to tender documents. Currently, India’s SPR storage capacity stands at 5.33 million metric tons, enough to cover just eight days of national oil consumption. The expansion of SPR sites has become a strategic priority, especially after the closure of the Strait of Hormuz earlier this year disrupted global oil supplies.
State-owned Oil and Natural Gas Corporation (ONGC) is also constructing a new storage site in Mangaluru to hold about 13 million barrels of oil. The disruptions caused by the Iran war and the closure of the Strait of Hormuz have forced India to seek alternative oil supplies, with record imports from Russia helping to mitigate the impact. However, the need for additional storage remains critical to safeguard against future supply shocks.
As one of the world’s largest crude oil importers, India is particularly vulnerable to supply disruptions. The current SPR capacity is insufficient to protect against prolonged interruptions, making the expansion of strategic reserves a key focus for the government.