The recent West Asia conflict has prompted the government to begin work on creating India’s first strategic natural gas storage system, with public sector oil companies evaluating multiple options, including underground salt caverns and above-ground cryogenic LNG tanks.
The move marks a significant expansion of India’s strategic energy security planning. While the Indian Strategic Petroleum Reserves Limited (ISPRL) manages the country’s strategic crude oil reserves, it does not have expertise in salt cavern-based natural gas storage. As a result, feasibility studies are underway to assess suitable storage technologies and geological structures.
“PSU oil companies are already working on the feasibility of storing crude oil and gas in salt caverns. ISPRL does not have expertise in salt caverns so a feasibility study is being done by Engineers India. Besides, storing gas in cryogenic overground tanks is also being worked out,” a source said.
The push follows concerns over India’s vulnerability to disruptions in LNG and LPG supplies after the West Asia conflict, with the Middle East Gulf accounting for more than half of India’s imports of both fuels. Sources said a committee under the Petroleum Ministry, constituted after the conflict erupted, is evaluating storage options for LNG and LPG. One of the seven Empowered Groups of Secretaries set up by the government is also examining short-, medium- and long-term measures to address potential disruptions to trade, supply chains and logistics.
“Some storage for gas has become important. The deliberations focus on what should be the storage volume keeping in view visibility over the next 4-5 years. Besides, another key issue to debate is that how much should be strategic and commercial considering storage buffers can also help monetise arbitrage opportunities like China does with its huge crude storage,” another source said.
The same source added: “The West Asia conflict has likely pushed ahead the schedule for these new production facilities with focus first on rebuilding damaged infrastructure like in Qatar’s Ras Laffan facility. We need to factor all these issues.”
Officials are evaluating a range of storage options, including salt caverns, depleted gas fields and cryogenic tanks near LNG regasification terminals. A recent study by the Council on Energy, Environment and Water (CEEW) noted that India has no dedicated strategic natural gas storage despite importing nearly half of its gas requirement, leaving key sectors exposed to supply disruptions.
Published on July 5, 2026
