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After a meeting with Saudi ambassador to India, Saleh Mohammad al Ghami, petroleum minister Mani Shankar Aiyar said this would not be the strategic crude oil reserves. IOC was in the process of setting up of strategic reserves.
The commercial storage facility would be owned by Saudi Aramco and IOC jointly while the crude would be owned by the Saudi company.
Aramco has such storage facilities in Rotterdam, South Korea and the Caribbean. The exact quantities and the location of such facility were being worked out, said Prabh Das, joint secretary in the ministry of petroleum and natural gas.
IOC and Hindustan Petroleum Corporation would also be holding discussion with Aramco on cross investment in the refinery sector.
Aiyar said that India was looking at Saudi cooperation in export-oriented refineries at Paradeep and Vishakapatnam.
HPCL's 7.5 million tonne Vizag refinery may be upgraded to make it export oriented, Aiyar said. The three companies would be holding further discussions on April 7 in New Delhi.
In return, Saudi Arabia has offered HPCL a stake in its Yanbu refinery off the Red Sea. HPCL would, however, be required to bid along with other global players to get a share in Yanbu, petroleum ministry officials said.
Another area of cooperation identified in the hydrocarbon sector was gas exploration. India expressed its interest in Ruv-al-Khali gas reserves as a starting point.
Aiyar said ONGC Videsh and Gail (India) will bid for gas blocks. Aiyar said Saudi Arabia permitted joint venture in the gas sector unlike in crude exploration.
He said from 2009-10 surplus gas would be available in Saudi Arabia. "We plan to collaborate all along the value chain of hydrocarbons," said Aiyar.
Ghami said that his country had invited Prime Minister Manmohan Singh for a visit to Saudi Arabia. External affairs minister Natwar Singh would also be visiting the country soon.
"We have started looking at India as a superpower. Both sides have decided to cooperate. One of the areas is petroleum," he said.
Ghami said the joint Saudi India Commission would be meeting on April 12 and 13 in Riyadh.