BHUBANESWAR: With the necessity of strengthening India’s fuel security infrastructure coming into sharp focus in the wake of ongoing war in West Asia, the urgency of fast-tracking the proposed strategic petroleum reserve (SPR) project at Chandikhol in Jajpur district has finally dawned on the powers that be.
The SPR project, envisioned as a key pillar for India’s energy security architecture, has faced significant delays over the past seven years, primarily due to land clearance bottlenecks and other bureaucratic hurdles.
Union Education minister Dharmendra Pradhan, who was in charge of the Petroleum ministry when the SPR was sanctioned, has written separate letters to Union Petroleum minister Hardeep Singh Puri and Chief Minister Mohan Charan Majhi, urging expedited implementation of the long-pending project.
The Rs 8,743-crore project, approved by the Union cabinet under Prime Minister Narendra Modi on June 27, 2018, aims to establish a 4 million metric tonne (MMT) underground crude oil storage facility at Chandikhol. However, despite early approvals, execution has remained stalled, with land acquisition and clearance issues emerging as key impediments.
In his communication, Pradhan flagged that he had earlier written to the then BJD government soon after the cabinet approval but the project failed to take off due to delays in making land available. The prolonged inaction has resulted in a lag in strengthening India’s strategic oil reserves at a time of increasing global energy uncertainty, he said.
Progress was revived only recently after a tripartite MoU was signed on April 8, 2025, in New Delhi between the state government, Industrial Promotion & Investment Corporation of Odisha (IPICOL) and Indian Strategic Petroleum Reserves Ltd (ISPRL), in the presence of Puri, Majhi and Pradhan. The agreement set the stage for moving the project forward, though there is little movement on-ground since.
The Chandikhol SPR is expected to be one of the largest underground crude storage facilities in the country. Once operational, it will enhance India’s crude oil reserve capacity by over seven days, adding to the existing 9.5 days of storage. This buffer is considered critical amid geopolitical tensions, particularly in West Asia, which have severely disrupted global energy supply chains.
Beyond energy security, the project is expected to have strong economic spillovers. It is projected to generate over 5,000 direct and indirect jobs and boost allied sectors such as logistics, construction and hospitality in the state, said Pradhan, adding, it is also seen as a strategic driver for industrial growth in eastern India, aligned with the Centre’s ‘Purvodaya’ vision.
Official sources said that 400 acres of land were identified by ISPRL, a special purpose vehicle (SPV) under the Ministry of Petroleum and Natural Gas, out of which IDCO has finalised lease deed for around 290 acres. Construction work for the projects has though not been possible due to ongoing quarrying activities.