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PESO licence & petroleum storage compliance
In India, a storage tank is only a working asset once it is licensed. This is how the rules work, and how VSS Enterprises takes the approvals through with the fabrication.
The short answer
Do you need a PESO licence?
If you store petroleum products beyond a small exempted quantity, yes. Storage of petroleum in India is governed by the Petroleum Rules, 2002, administered by the Petroleum and Explosives Safety Organisation (PESO) under the Government of India. Products are classified by flash point, and the class — together with how much you store — determines whether a licence is required and what the tank must look like.
The practical implication for most industrial sites is simple: a diesel storage tank above 1,000 litres in bulk needs a licence. That covers almost every generator-set fuel installation in the country.
Classification
Petroleum classes and licence thresholds
Indicative thresholds under the Petroleum Rules, 2002. Confirm the exact requirement for your product and site with PESO or a licensed consultant.
| Class | Flash point | Products | No-licence limit |
|---|---|---|---|
| A | Below 23 °C | Hexane, toluene, acetone, ethanol, methanol, MEK, naphtha, benzene, motor spirit (petrol), pentane, solvent 1425 | ~30 litres |
| B | 23 – 65 °C | High speed diesel (HSD), MTO, aromax | 1,000 L bulk 2,500 L non-bulk |
| C | 65 – 93 °C | Furnace oil (FO), light diesel oil (LDO) | 45,000 L bulk prior report >5,000 L |
Process
What a storage licence actually requires
A PESO storage licence is not a form. It is an engineering submission: the tank must be designed and built to satisfy the distance norms, fire protection and containment requirements that apply to the class and quantity of product being stored.
- Correct product classification and quantity declaration
- Tank design and statutory drawings
- Separation distances to boundaries, buildings and roads
- Bunding, dyke walls and containment volume
- Fire protection and safety provisions
- Hydrotesting and material test certificates
- Application on the PESO portal (NSWS), inspection and approval
- Local NOC and site clearances
Statutory fees
What the licence costs
Under the Petroleum Rules, 2002 (as amended in 2018), the statutory fee for storage of petroleum in an installation is ₹5,000 for the first 50 kL plus ₹50 per additional kilolitre, capped at ₹50,000 per calendar year for each class of petroleum.
That is the government fee only. Consultant charges, statutory drawings, testing and inspection costs are separate — and this is where a fabricator who understands the submission saves time and avoids a rejected application.
Explosive licence
Where a facility handles explosives or certain hazardous materials, a separate explosive licence is required, in two stages — initial and final. VSS Enterprises coordinates both stages along with the petroleum storage licence and the local NOC.
Questions
Compliance questions
What is a PESO licence?
A PESO licence is an approval issued by the Petroleum and Explosives Safety Organisation, a body under the Government of India's Department for Promotion of Industry and Internal Trade. It is required to store, handle, transport or import petroleum products, compressed gases and explosives beyond specified threshold quantities.
What quantity of diesel can be stored without a PESO licence?
High speed diesel is a Class B product. No licence is required if the total quantity stored does not exceed 1,000 litres in bulk (a tank) or 2,500 litres in non-bulk (drums). Above that, a storage licence under the Petroleum Rules, 2002 is required.
What quantity of furnace oil or LDO can be stored without a licence?
Furnace oil and light diesel oil are Class C products. No licence is required for storage up to 45,000 litres in bulk at any one place. If storage exceeds 5,000 litres, a prior report under rule 140 of the Petroleum Rules, 2002 is required.
Which products are Class A petroleum?
Class A products have a flash point below 23 °C: hexane, toluene, acetone, ethanol, methanol, MEK, naphtha, benzene, motor spirit (petrol), pentane and solvent 1425. The exemption threshold is approximately 30 litres.
How much does a PESO storage licence cost?
The statutory fee is ₹5,000 for the first 50 kL plus ₹50 per additional kilolitre, capped at ₹50,000 per calendar year for each class of petroleum. Consultant, drawing and testing costs are additional.
Can VSS Enterprises obtain the licence for me?
VSS Enterprises coordinates PESO petroleum storage and explosive licence applications — initial and final — along with statutory drawings, the local NOC and the documentation the inspection requires. It is delivered as part of the turnkey scope. Formal licence-holder responsibility remains with the site owner.
Need a tank that will pass inspection?
Tell us the product and quantity you intend to store. We will confirm the class, the licence requirement and the tank specification.