New Delhi, March 14. (PTI): India will build its first strategic crude oil storage of 5 million tonnes by 2012 and will raise it to 15 million tonnes in the next phase as part of steps to ensure energy security, the Rajya Sabha was informed on Tuesday.

"In order to enhance the energy security of the country and to safeguard against short-term supply disruptions, the Government has approved setting up of 5 million tonnes strategic storage of crude oil," Minister of State for Petroleum and Natural Gas Dinsha Patel said in a written reply.

The storage would be located at three places - Vizag (one million tonnes), Mangalore 1.5 million tonnes) and Padur, Udipi (2.5 million tonnes), he said.

The crude oil will be released in the event of any natural calamity or disruption in supplies or any unforeseen global event leading to scarcity of supplies or an abnormal increase in prices.

"This project is likely to be completed by the end of 11th Five-Year Plan (2012)," he said, adding the Government is planning to enhance the capacity of the strategic reserves to 15 million tonnes in the next phase.

KPMG, he said, has recently conducted a study on various options for developing a strategic petroleum reserve under public private partnership.

"As the cost would be eventually borne by domestic refiners/companies and/or passed on to the consumers in some form, none of the suggested models appear feasible or cost effective," he said.

The day in pictures