New Delhi, March 31 (IANS): The Cabinet Committee on Economic Affairs (CCEA) on Tuesday approved allocation of Rs.4,948 crore for gross budgetary support (GBS) to the scheme for the Indian Strategic Storage Programme for Storage of Crude Oil (ISSPSCO).

ISSPSCO involves construction of three crude oil reserves totalling 5.33 Metric Million Tonnes to meet the nation's energy security needs.

Under the initiative, the entire cost for filling crude oil in Visakhapatnam cavern will be met by the central government.

"This is against the 12th Plan outlay of Rs.4,948 crore under the GBS scheme of ministry of petroleum and natural gas for the Indian Strategic Storage Programme for storage of crude oil. The remaining amount would be used for filling up the strategic part of the caverns which are being constructed at Mangalore and Padur," an official statement said.

The CCEA decided that the petroleum and natural gas ministry will continue to explore alternative models for financing the remaining cost of crude oil to fill the Mangalore and Padur caverns which will include commercial utilization by "other interested parties".

The government said the annual Operations and Maintenance (O&M) costs are estimated to be Rs. 47 crore for the Vishakhapatnam storage and Rs.179 crore for all the three caverns.

"This decision will facilitate in dealing with the situation of any disruption in the supply chain of crude oil and abnormal spike in world oil prices," it said.