Using ICS, is it possible to store and use all my contacts on SIM only?
If it is possible I don't really want to copy all my contacts to the phone and I would prefer all the new contacts to be stored only on SIM card.
You haven't mentioned which phone you use.
Unsure about ICS, but on Gingerbread, go to Contacts - press MENU > MORE > SETTINGS > SAVE CONTACTS to - SIM
This is available on newer versions though, YMMV.