Visakhapatnam To Padur: The Underground Rock Caverns That Could Store UAE Crude Oil

Prime Minister Narendra Modi’s visit to the United Arab Emirates on Friday did more than deepen diplomatic ties between the two countries. It also pushed India’s long-term energy security plans into sharp focus.

Among the key agreements signed during the visit was a memorandum of understanding between the Abu Dhabi National Oil Company (ADNOC) and Indian Strategic Petroleum Reserves Limited (ISPRL), paving the way for the UAE giant to store up to 30 million barrels of crude oil in India’s strategic petroleum reserve network.

That crude could eventually be stored inside giant underground rock caverns spread across Visakhapatnam in Andhra Pradesh, Mangaluru and Padur in Karnataka, as well as future facilities planned in Chandikhol, Odisha.

The agreement

comes at a time when tensions in West Asia and fears around the Strait of Hormuz due to the US-Iran war are raising questions over how vulnerable India remains to global supply disruptions.

For India, which imports the overwhelming majority of its crude oil needs, these underground caverns are emergency energy vaults designed to keep the country running during a crisis.

What Are Strategic Petroleum Reserves?

India’s Strategic Petroleum Reserves (SPR) are emergency crude oil stockpiles maintained by the government to protect the country against severe supply disruptions caused by wars, geopolitical crises or sudden spikes in oil prices.

The reserves are managed by ISPRL under the Ministry of Petroleum and Natural Gas.

Unlike commercial reserves maintained by oil marketing companies for routine operations, strategic reserves are meant for exceptional situations when regular imports become difficult or prohibitively expensive.

At present, India’s Phase-I SPR facilities — located at Visakhapatnam in Andhra Pradesh, and Mangaluru and Padur in Karnataka — have a combined capacity of 5.33 million metric tonnes (MMT) of crude oil. Together, they can provide roughly 9.5 to 10 days of crude oil cover based on India’s consumption levels.

However, when combined with commercial stocks held by oil marketing companies, India’s total crude oil buffer rises to around 74 days.

Inside India’s Three Major Strategic Oil Caverns

Visakhapatnam

Located on the east coast in Andhra Pradesh, the Visakhapatnam facility was among the first strategic reserves developed under India’s SPR programme.

Its location along the Bay of Bengal gives it strategic importance for handling crude imports arriving from multiple international shipping routes.

Mangaluru

Mangaluru in Karnataka already plays a central role in India-UAE energy cooperation.

ADNOC became the first foreign company to store over 5 million barrels of crude oil in India’s strategic reserves in 2018 under an agreement signed with ISPRL a year earlier. The arrangement allowed the UAE firm to use the 750 TMT-capacity Cavern-A facility at Mangaluru.

Located close to the Arabian Sea, the site offers logistical advantages for crude imports arriving from West Asia.

Padur

Padur, also in Karnataka, forms another critical component of India’s strategic petroleum reserve network.

The government approved an expansion project at Padur under Phase II of the SPR programme, with an additional 2.5 MMT facility planned under a commercial-cum-strategic model.

Construction work for the expansion was awarded in October 2025.

Its location on the western coast gives India another major storage point connected to key maritime oil routes.

How Deep Are These Caverns?

The storage facilities are located around 90 metres below ground level and can stretch up to a kilometre in length. Some sections are comparable in height to a 10-storey building.

One of the most remarkable facilities is the underground LPG cavern in Visakhapatnam, which extends deep below sea level and is considered among the deepest underground fuel storage caverns globally.

Crude oil is pumped into these caverns through specialised pipelines and can later be released into refinery networks during emergencies or supply shortages.

Why Is India Focusing On These Underground Oil Caverns?

The renewed focus comes amid growing instability in West Asia, a region that remains central to global oil supplies.

The ongoing Iran-US-Israel conflict has severely disrupted shipping through the Strait of Hormuz, one of the world’s most critical oil chokepoints through which a major portion of global crude supplies passes. The prolonged disruption has already pushed up crude prices, shipping costs and supply uncertainties across international markets.

Oil prices jumped as much as 8 per cent this week before closing Friday’s session more than 3 per cent higher, after remarks from US President Donald Trump and Iran’s foreign minister reduced hopes of a near-term agreement to halt attacks and vessel seizures around the Hormuz.

For India, expanding cooperation with ADNOC offers both supply security and storage flexibility. The new arrangement also includes the possibility of storing crude oil in Fujairah as part of India’s strategic reserve system, giving New Delhi an additional layer of energy protection outside its borders.

What Is Chandikhol And Why Is It Important?

India is also expanding its strategic reserves to the eastern coast through a planned 4 MMT facility at Chandikhol in Odisha.

Approved in 2021 as part of Phase II expansion, the project is expected to significantly increase India’s emergency crude storage capacity.

The eastern coast is strategically important because it allows diversification of storage infrastructure across both sides of the country, reducing dependence on a limited number of facilities.

Why Does India Store Oil Underground Instead Of In Giant Tanks?

India stores its strategic crude oil underground because rock caverns are considered significantly safer and more efficient than above-ground storage tanks.

In a densely populated and geopolitically sensitive country, underground caverns provide natural protection against aerial attacks, sabotage and extreme weather events. They also reduce evaporation losses and minimise environmental risks.

The caverns are carved deep inside hard rock formations and sealed using advanced engineering systems to prevent leakage or contamination. Monitoring systems continuously track pressure, seepage and structural stability.

The concept was first developed in Sweden during the Cold War as a wartime safeguard before being adopted by countries such as Japan, Finland and South Korea.

In India, the idea began taking shape after the 1990 Gulf War exposed the country’s vulnerability to external oil shocks. The push for underground strategic reserves gathered momentum under the Atal Bihari Vajpayee government in the late 1990s.

How India Used These Caverns During Covid

India’s strategic caverns proved valuable during the Covid-19 pandemic, when global oil prices collapsed sharply amid falling demand.

The government used the opportunity to purchase cheaper crude and fill the underground reserves, a move that helped save around Rs 5,000 crore, according to the Petroleum Ministry.

With ADNOC set to expand its role in India’s strategic reserves and tensions around the Strait of Hormuz continuing to threaten global oil supplies, India’s underground rock caverns remain crucial to the country’s energy security plans.