News Release Details
10 firms short-listed for setting up crude reserves
Mumbai 25-Jun-2007
The construction of the country's first strategic crude oil reserves in Vishakapatnam may kick off soon with Engineers India Ltd (EIL) short listing 10 companies out of 13 that took part in the prequalification process. The companies that participated included construction majors like Hindustan Construction Company, Patel Engineering and Larsen & Toubro, sources said. "Since it was open international notice for expression of interests, a num-her of foreign companies, including Korean and Japanese companies, also took part in the process," said an official. Korean engineering and construction company SKEC has tied up with L&T for the project that would involve construction of underground caverns. The Union Cabinet last year approved setting up of the strategic reserves at a cost of Rs 11,267 crore. The final cost is, however, likely to go up. The strategic crude oil reserves are being constructed by Indian Strategic Petroleum Reserve Ltd (ISPRL) though the short listing of bidders has been done by EIL based on the technical requirement for the project. Mangalore in Karnataka will have 1.5 mt of reserves with Rs 732 crore capital cost while storage in Visakhapat-nam will be built at the cost of Rs 672 crore with about 1 mt reserve. Another location near Mangalore with about 2.5 mt capacity will be built at the cost of Rs 993 crore. Sources said the drafting of bidding document has been completed and ISPRL board will be finalising it for discussion with the companies. ISPRL has also signed project management consultancy (PMC) contract with EIL. A similar PMC contract would be signed with EIL for Mangalore storage also. While the construction work is expected to take two years, the actual filling will start four years after the construction and will be done over three years. ISPRL will create 5 million tonne (mt) reserves that are expected to take care of 15 days of country's demand. The government plans to later increase the capacity to 10 mt. The cost of filling up of the storage would be about Rs 8,870 crore, assuming $55 a barrel average price of Indian basket of crude and an exchange rate of Rs 44 for a dollar. The cost may rise though with crude oil price expected to be higher besides sources said the capital cost would also go up.
Mumbai 25-Jun-2007
The construction of the country's first strategic crude oil reserves in Vishakapatnam may kick off soon with Engineers India Ltd (EIL) short listing 10 companies out of 13 that took part in the prequalification process. The companies that participated included construction majors like Hindustan Construction Company, Patel Engineering and Larsen & Toubro, sources said. "Since it was open international notice for expression of interests, a num-her of foreign companies, including Korean and Japanese companies, also took part in the process," said an official. Korean engineering and construction company SKEC has tied up with L&T for the project that would involve construction of underground caverns. The Union Cabinet last year approved setting up of the strategic reserves at a cost of Rs 11,267 crore. The final cost is, however, likely to go up. The strategic crude oil reserves are being constructed by Indian Strategic Petroleum Reserve Ltd (ISPRL) though the short listing of bidders has been done by EIL based on the technical requirement for the project. Mangalore in Karnataka will have 1.5 mt of reserves with Rs 732 crore capital cost while storage in Visakhapat-nam will be built at the cost of Rs 672 crore with about 1 mt reserve. Another location near Mangalore with about 2.5 mt capacity will be built at the cost of Rs 993 crore. Sources said the drafting of bidding document has been completed and ISPRL board will be finalising it for discussion with the companies. ISPRL has also signed project management consultancy (PMC) contract with EIL. A similar PMC contract would be signed with EIL for Mangalore storage also. While the construction work is expected to take two years, the actual filling will start four years after the construction and will be done over three years. ISPRL will create 5 million tonne (mt) reserves that are expected to take care of 15 days of country's demand. The government plans to later increase the capacity to 10 mt. The cost of filling up of the storage would be about Rs 8,870 crore, assuming $55 a barrel average price of Indian basket of crude and an exchange rate of Rs 44 for a dollar. The cost may rise though with crude oil price expected to be higher besides sources said the capital cost would also go up.