The Indian Strategic Petroleum Reserves Ltd on Monday issued tenders for the first tranche of the post-crisis expansion cleared by cabinet in June: 6.5 million tonnes of new underground cavern capacity at Mangalore and Padur, the opening move in the programme to lift national crude cover from 74 to 130 days by 2031.
The tender's commercial architecture marks the programme's real evolution. The new caverns will operate on a hybrid model: two-thirds sovereign stock, one-third leased to commercial traders and foreign national oil companies on the Korean-Japanese template, with a first-refusal clause that lets the government commandeer leased stock during a declared supply emergency. The model makes the expansion partly self-financing — lease revenues are projected to cover 40 percent of capital costs over the concession life — and, more subtly, it keeps the caverns cycling with fresh crude rather than ageing sovereign stock.
The war quarter supplied the programme's justification and its urgency. When the strait closed in March, India held 74 days of total cover but only 9.5 days in the dedicated strategic reserve; the rest sat in commercial tankage and pipelines whose drawdown the government could influence but not command. The cabinet note accompanying the June decision, portions of which have been reported, described the March experience bluntly: the country's energy diplomacy held because the corridor reopened in six weeks, not because the buffer would have outlasted a longer closure.
The geography of the expansion follows the lesson. Both first-tranche sites sit on the west coast with dedicated single-point moorings — but the programme's second phase, already in site studies, moves inland and east: salt-cavern storage in Rajasthan linked to the refinery grid by pipeline, and a coastal site on the Bay of Bengal that diversifies away from Arabian Sea chokepoints entirely.
The timeline is the tender's most aggressive clause. Cavern excavation of this scale has historically run seven years in India; the tender demands first fill at Mangalore in 54 months, with bonus-penalty structures borrowed from the freight-corridor contracts. Industry consortia from three countries have pre-qualified.
Energy-security programmes are usually judged in decades. This one has a nearer test: the next time the strait closes — and the review that accompanied the June decision treats that as a when — the drawdown maths will be public within days.