Global strategic petroleum reserves
Global strategic petroleum reserves (GSPR) refer to crude oil inventories (or stockpiles) held by the government of a particular country, as well as private industry, to safeguard the economy and help maintain national security during an energy crisis.
According to the United States Energy Information Administration, approximately 4.1 billion barrels (650,000,000 m3) of oil are held in strategic reserves, of which 1.4 billion is government-controlled. The remainder is held by private industry. In 2004 the U.S. Strategic Petroleum Reserve had the largest strategic reserve, with much of the remainder held by the other 27 members of the International Energy Agency. Some non-IEA countries have started work on their own strategic petroleum reserves. China has the largest of these new reserves.
Global oil consumption is in the region of 0.1 billion barrels (16,000,000 m3) per day. The 4.1 bbl reserve is equivalent to 41 days of production. If there ever is a dramatic fall in global output, as envisaged by some peak oil analysts, the strategic petroleum reserves might be used to cover the shortfall. Covering a 50% shortfall would deplete the reserves in 82 days, although export leaders the Middle East and Russian exports represent only 22% and 6% respectively of global production.
- 1 International Energy Agency reserves
- 2 Forward commercial storage agreements
- 3 Emergency oil sharing agreements
- 4 Africa
- 5 Asia
- 6 Europe
- 7 Middle East
- 8 North America
- 9 Oceania
- 10 See also
- 11 References
- 12 External links
International Energy Agency reserves
According to a March 2001 agreement, all 28 members of the International Energy Agency must have a strategic petroleum reserve equal to 90 days of the previous year's net oil imports for their respective countries. Only net-exporter members of the IEA are exempt from this requirement. The exempt countries are Canada, Denmark, Norway, and the United Kingdom. However, the UK and Denmark recently drew up plans to create their own strategic reserves in order to meet their legal obligations as European Union member states.
Forward commercial storage agreements
To allow oil-exporting countries increased flexibility in their production quotas, there has been a progressive movement towards forward commercial storage agreements. These agreements allow petroleum to be stored within an oil-importing country. However, the reserves are technically under the control of the oil-exporting country. Such agreements enable oil-importing countries to access these commercial reserves in a timely and cost effective way.
Emergency oil sharing agreements
Several countries have agreements to share their stockpiles with other countries in the event of an emergency.
The Japan, New Zealand and South Korea agreement
In 2007, Japan announced a plan to share its strategic reserves with other countries in the region. Negotiations are under way between Japan and New Zealand for an oil-sharing deal whereby Japan sells part of its strategic reserves to New Zealand in the event of an emergency. New Zealand would be required to pay the market price for the oil, plus negotiated option fees for the amount of oil previously held for them by Japan.
South Korea and Japan have agreed to share their oil reserves in the event of an emergency.
The United States and Israel agreement
According to the 1975 Second Sinai withdrawal document signed by the United States and Israel, in an emergency the U.S. is obligated to make oil available for sale to Israel for a period of up to five years.
The France, Germany, and Italy agreement
France, Germany and Italy have an oil-sharing agreement in place that allows them to buy oil from each other in the event of an emergency. In 1968, the six members of the European Economic Community – Belgium, France, Germany, Italy, Luxembourg and the Netherlands – agreed to maintain a minimum level of crude oil stocks and oil products corresponding to 65 days' worth of domestic consumption. In 1972, this obligation was raised to 90 days.
Malawi is considering creating a 22-day reserve of fuel, which is an expansion from the current five-day reserve. The government is planning to build storage facilities in the provinces of Chipoka and Mchinji as well as Kamuzu International Airport.
South Africa has an SPR managed by PetroSA. The main facility is the Saldanha Bay oil storage facility, which is a major transit point for oil shipping. Saldanha Bay's six in-ground concrete storage tanks give the facility a storage capacity of 45,000,000 barrels (7,200,000 m3).
In 2007, China announced the expansion of its crude reserves into a two-part system. China's reserves would consist of a government-controlled strategic reserve complemented by mandated commercial reserves. The government-controlled reserves are being completed in three stages. Phase one consisted of a 101,900,000 barrels (16,200,000 m3) reserve, mostly completed by the end of 2008. The second phase of the government-controlled reserves with an additional 170,000,000 barrels (27,000,000 m3) was to be completed by 2011. Recently, Zhang Guobao, head of the National Energy Administration, stated that there will be a third phase that will expand reserves by 204,000,000 barrels (32,400,000 m3) with the goal of increasing China's SPR to 90 days of supply by 2020.
The planned state reserves of 475,900,000 barrels (75,660,000 m3) together with the planned enterprise reserves of 209,440,000 barrels (33,298,000 m3) will provide around 90 days of consumption or a total of 684,340,000 barrels (108,801,000 m3).
In 2003, India started development on a strategic crude oil reserve sized at 37,400,000 barrels (5,950,000 m3), enough to provide two weeks of consumption. Petroleum stocks have been transferred from the Indian Oil Corporation (IndianOil) to the Oil Industry Development Board (OIDB). The OIDB then created the Indian Strategic Petroleum Reserves Ltd (ISPRL) to serve as the controlling government agency for the strategic reserve.
The facilities are located at:
- Mangalore, State of Karnataka. Capacity of 10.995 million barrels (1,748,100 m3).
- Padur village, Udupi in the state of Karnataka. Capacity of 18.7 million barrels (2,970,000 m3).
- Visakhapatnam, State of Andhra Pradesh. Capacity of 1.33 million tonnes.
On 21 December 2011, a senior oil ministry official announced that India was planning to augment its crude reserve capacity to 132 million barrels by 2020.
As of 2010, Japan has an SPR composed of the following three types of stockpiles:
- State-controlled reserves of petroleum at 11 different locations totaling 324,000,000 barrels (51,500,000 m3). All numbers, unless otherwise cited, come from p. 177 of this document: 
- Tomakomai Eastern Oil Reserve Storage Base – 55 storage tanks, total capacity 34 million barrels (5,400,000 m3).
- Mutsu-Ogawara Storage Base – 53 storage tanks, total capacity 31 million barrels (4,900,000 m3).
- Kuji Storage Base – three storage tanks, total capacity 10.5 million barrels (1,670,000 m3).
- Akita Storage Base – 15 storage tanks, total capacity 23.4 million barrels (3,720,000 m3).
- Fukui Storage Base – 27 storage tanks, total capacity 17.9 million barrels (2,850,000 m3).
- Kikuma Underground Petroleum Storage Facility – eight storage tanks, total capacity 8.9 million barrels (1,410,000 m3).
- Shirashima Storage Facility – eight tankers (4,400,000 barrels (700,000 m3) each), total capacity 35.2 million barrels (5,600,000 m3).
- Kamigotou Storage Base – seven storage tanks, total capacity 21.45 million barrels (3,410,000 m3).
- Kushikino Storage Base – three storage tanks, total capacity 10.5 million barrels (1,670,000 m3).
- Shibushi Storage Base – 40 storage tanks, total capacity 27.6 million barrels (4,390,000 m3).
- Kagoshima – 4.0 million barrels (640,000 m3). A forward commercial storage facility with Abu Dhabi.
- Private reserves of petroleum held "in accordance with the Petroleum Stockpiling Law" of 129,000,000 barrels (20,500,000 m3).
- Private reserves of petroleum products for another 130,000,000 barrels (21,000,000 m3).
The state-controlled reserves and the privately held stockpiles total about 583,000,000 barrels (92,700,000 m3). The Japanese SPR is run by the Japan Oil, Gas and Metals National Corporation.
In South Korea, refineries, specified distributors, and importers, are obliged to hold from 40 days to 60 days of their daily import, sale, or refined production, based on the previous 12 months. At the end of 2010, South Korea possessed a total storage capacity of 286 million barrels (45.5 million cubic meters), composed of 146 mb of South Korea National Oil Corporation's facilities used for government stocks and international joint oil stockpiling, and 140 mb used for industry operation and mandatory industry stocks. South Korea's oil stocks in terms of days of net imports have consistently been above 160 days since January 2009, hitting the country’s historical record of 240 days (124 days of government stocks and 117 days of industry stocks) in March 2014.
Singapore does not have any oil reserves.
Taiwan has an SPR with a 1999-reported size of 13,000,000 barrels (2,100,000 m3). Taiwan's refiners (Kaohsiung 270,000 bbl/d (43,000 m3/d); Ta-Lin 300,000 bbl/d (48,000 m3/d); Tao-Yuan 200,000 bbl/d (32,000 m3/d); Mailiao 150,000 bbl/d) are also required to store at least 30 days of petroleum stocks. As of 2005, these mandated commercial reserves total 27,600,000 barrels (4,390,000 m3) of strategic petroleum stocks.
In the European Union, according to Council Directive 68/414/EEC of 20 December 1968, all 28 member states are required to have a strategic petroleum reserve within the territory of the E.U. equal to at least 90 days of average domestic consumption.
France has an SPR with an approximate size of 65,000,000 barrels (10,300,000 m3). As of 2000, jet fuel stocks for at least 55 days of consumption were required, with half of those stocks controlled by the Société Anonyme de Gestion des Stocks de Sécurité (SAGESS) and the other half controlled by producers.
Germany created the Federal Oil Reserve in 1970, located in the Etzel salt caverns near Wilhelmshaven in northern Germany, with an initial size of 70 million barrels (11,000,000 m3). The current German Federal Oil Reserve and the Erdölbevorratungsverband (EBV) (the German stockholding company) mandates that refiners must keep 90 days of stock on hand, giving Germany an approximate reserve size of 250,000,000 barrels (40,000,000 m3) as of 1997. The German SPR is the largest in Europe.
Ireland has approximately 31 days of oil stocks in Ireland and another nine days of oil stocks held in other EU members states. Additionally, it has stock tickets (contracts with a third party whereby the government has the option of purchasing oil in the event of an emergency) and stocks held by large industry or large consumers. In total, Ireland has approximately 100 days' worth of oil at its disposal.
Poland has an SPR equal to approximately 70 days of consumption. Another facility holding 20 days of consumption was completed in 2008. Poland also requires oil companies to maintain reserves sufficient to provide 73 days of consumption.
The United Kingdom recently drew up plans to create its own strategic fuel reserves.
As of 2011, Russia is accumulating strategic reserves of refined oil products to be held by Rosneftegaz, a state-owned company. The reserves will be held at commercial refineries, Transneft facilities and state reserve facilities. The current planned size is 14,665,982 barrels (2,331,704.8 m3).
Switzerland has SPRs consisting of gas, diesel, jet fuel and heating oil for 4.5 months of consumption. The reserves were created in the 1940s.
In April 2006, the Fars News Agency reported that Iran was planning to create an SPR. The National Iranian Oil Company (NIOC) began construction of 15 crude oil storage tanks with a capacity of 10,000,000 barrels (1,600,000 m3). In August 2008, Iran announced plans to expand the SPR with a new facility on Kharg Island with four tanks holding 1,000,000 barrels (160,000 m3) each. Iran's SPR facilities are:
- Ahwaz – four storage tanks, total capacity 2 million barrels (320,000 m3).
- Omidiyeh – three storage tanks, total capacity 3 million barrels (480,000 m3).
- Goureh – six storage tanks, total capacity 4 million barrels (640,000 m3).
- Sirri Island – one storage tank, total capacity 500,000 barrels (79,000 m3).
- Bahregansar – one storage tank, total capacity 500,000 barrels (79,000 m3).
- Kharg Island – four storage tanks, total capacity 4 million barrels (640,000 m3). (Planned facility, not operational yet.)
As of 1975, Israel is believed to have a strategic oil reserve equal to 270 days of consumption.
The United States has the world's largest reported Strategic Petroleum Reserve with a total capacity of 727 million barrels. If completely filled, the U.S. SPR could theoretically replace about 60 days of oil imports. The U.S. is estimated to import approximately 12,000,000 barrels per day (1,900,000 m3/d) of crude oil. According to the U.S. Department of Energy, the facilities' maximum flow rate is limited to approximately 4,400,000 barrels per day (700,000 m3/d) when filled to maximum capacity, declining as the reserve is emptied. The reserves are kept in salt caverns located at:
- Bryan Mound – near Freeport, Texas. Capacity of 226,000,000 barrels (35,900,000 m3).
- Big Hill – near Winnie, Texas. Capacity of 160,000,000 barrels (25,000,000 m3).
- West Hackberry – near Lake Charles, Louisiana. Capacity of 219,000,000 barrels (34,800,000 m3).
- Bayou Choctaw – near Baton Rouge, Louisiana. Capacity of 72,000,000 barrels (11,400,000 m3).
- Richton, Mississippi. A planned facility.
The U.S. also has the 2-million-barrels (320,000 m3) Northeast Home Heating Oil Reserve to supply northeast home owners with heating oil if there is a shortage.
As of 2008, New Zealand has a strategic reserve with a size of 170,000 tons or 1,200,000 barrels (190,000 m3). Much of this reserve is based upon ticketed option contracts with Australia, Japan, the United Kingdom and the Netherlands, which allow for guaranteed purchases of petroleum in the event of an emergency.
As of 2008, Australia holds three weeks of petroleum, instead of the allotted 90 days that was agreed upon, according to the study 'Liquid Fuel Security' authored by Air Vice-Marshal John Blackburn, AO (retired).
- "Fact Sheet on IEA Oil Stocks and Emergency Response Potential" (PDF). International Energy Agency. 2004-01-01.
- https://"Short-Term Energy Outlook". U. S. Energy Information Administration (EIA). February 9, 2016.
- "Crude Oil - Exports". Central Intelligence Agency - The World Factbook. Retrieved 17 May 2016.
- "Crude Oil - Production". Central Intelligence Agency - The World Factbook. Retrieved 17 May 2016.
- Reauthorization of the Energy Policy & Conservation Act
- RIGZONE - Article Not Found
- South Korea, Japan agree to share oil reserves - International Herald Tribune
- The Iranian Oil Crisis
- Nyasa Times - Malawi breaking news, sports, showbiz, jobs, business and social networking - Malawi to increase fuel storage
- South Africa's energy industry - SouthAfrica.info
- Alexander's Gas & Oil Connections - India to build up storage of crude oil
- The Hindu Business Line : Strategic oil reserves to come directly under Govt
- "News By Industry". The Times Of India. 2007-06-20.
- "India Unveils Ambitious New Strategic Oil Stockpile Plans". The Wall Street Journal. 2011-12-21.
- The Oil Situation after the Attack on Iraq
- "Energy Security in East Asia". Institute for the Analysis of Global Security. 2004-08-13.
- "Energy Security Initiative" (PDF). Asia Pacific Energy Research Center. 2002-01-01.
- "Oil and Gas Emergency Policy - Korea 2011 update" (PDF). www.iea.org. 2011-12-21.
- "Closing Oil Stock Levels in Days of Net Imports". www.iea.org. 2014-03-14.
- Energy conservation takes center stage in the Philippines | EnergyBulletin.net | Peak Oil News Clearinghouse
- "Improving Energy Security Through an International Cooperative Approach to Strategic Oil Stocks" (PDF). International Energy Agency. 2003-09-19.
- The Brunei Times
- "Council Directive 68/414/EEC of 20 December 1968 imposing an obligation on Member States of the EEC to maintain minimum stocks of crude oil and/or petroleum products". European Union. 1968-12-20.
- North Central Europe
- "European Leaders Fire Up Over Russian Oil Cut". Global Insight. 2007-01-10. Retrieved 2007-01-10.
- Danish Agency for Energy
- People's Daily Online - Finland decides to tap strategic oil reserves in Katrina aftermath
- Embassy of France in the US - katrina - Strategic oil reserves <
- GERMANY - Online Research Center
- Hungarian govt releases strategic oil reserves after Russian supply cut-off
- "Poland mulls oil reserve changes for refiners". Reuters. 2008-09-03.
- "Portugal to tap oil reserves to help hurricane-ravaged US". AFP. 2005-09-01.[dead link]
- Staff Writer. "El Consejo de Ministros aprueba el envío del 2% de las reservas de crudo para ayudar a EEUU." El Mundo. 9 September 2005. Retrieved on 10 June 2006. Article in Spanish.
- People's Daily Online - Swedish government releases gasoline reserves
- "UPDATE 2-Russia to build state fuel stocks to ease shortages". Reuters. 2011-07-13.
- "Joint Stockpiling with Kuwait". Korea National Oil Corporation. Retrieved 2 November 2015.
- See Strategic Petroleum Reserve (United States)
- "Nippon Oil sells emergency oil reserves option to NZ". Reuters. 2007-12-27.
For more on APEC strategic reserves:
For more info on the IEA reserves: