(EnergyAsia, February 8, 2017, Wednesday) — Abu Dhabi, a member of the United Arab Emirates (UAE), will soon begin shipping some of its crude oil for stockpiling in India’s Mangalore strategic petroleum terminal on the western coastal state of Karnataka.
The two countries sealed the stockpiling agreement for 5.86 million barrels as part of a larger 14-point deal to expand bilateral ties concluded last month when Indian Prime Minister Narendra Modi received a visiting delegation led by Abu Dhabi’s Crown Prince Sheikh Mohamed bin Zayed Al Nahyan.
The Indian Strategic Petroleum Reserves Ltd (ISPRL) will store and manage crude oil owned by state-owned Abu Dhabi National Oil Company (ADNOC) at its recently completed underground cavern in Mangalore.
Sultan Ahmed Al Jaber, the UAE’s Minister of State, described the deal as marking a “new strategic energy partnership” between the two countries.
“This partnership will create opportunities for ADNOC to increase its market share in delivering high quality crude to India’s expanding refining industry, while also helping India meet its growing energy demand and safeguard its security,” he said.
Al Jaber, who is also CEO of ADNOC Group, said his company will use the Mangalore terminal to explore opportunities for expanding sales and marketing of refined and petrochemical products in India.
ADNOC said it has similar crude stockpiling arrangements with state-owned KNOC in South Korea and with the Kiire Oil Terminal in Kagoshima City in Japan.
ADNOC said it will also consider supplying crude oil to West Bengal’s Haldia Petrochemicals Ltd’s (HPL) new 300,000 b/d refinery in Kolkata.
India’s Petroleum Minister Dharmendra Pradhan said the added stockpile and supply of Abu Dhabi crude will strengthen India’s search for energy security. Abu Dhabi accounts for eight percent of India’s oil imports.
Iran, the first Middle Eastern country to sign up to stockpile crude oil in India, is storing six million barrels at the Mangalore terminal.