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NOC proposes IOC to ‘gift’ petroleum pipeline project | Nepali Economy
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NOC proposes IOC to ‘gift’ petroleum pipeline project

Nepal Oil Corporation (NOC) has asked Indian Oil Corporation (IOC) to construct Amalekhgunj-Raxual petroleum pipeline as a ‘gift project’.

The Nepali delegation, in the bilateral talks in New Delhi recently, proposed Indian officials to construct the dream pipeline project and hand it over to Nepal.

The bilateral talks between New Delhi and Kathmandu has gathered momentum after Indian Prime Minister Narendra Modi – during his visit to Kathmandu on August 3-4 – promised to construct the petroleum pipeline that is estimated to cost around Rs 5.5 billion Indian Currency (IC). Of the total cost, land acquisition is expected to cost half, and rest for capacity upgradation of NOC’s Amlekhgunj depot, its automation, and construction of a pumping station.

After the completion of pipeline project, Nepal will receive petroleum products at the rate of 190 kilolitres (kl) per hour.

The Amlekhgunj depot has the capacity of stocking 1,900kl petrol, 10,800kl diesel and 5,600kl kerosene. However, it does not have a separate warehouse for aviation fuel.

The Indian Oil Corporation (IOC) is on regular contact with NOC on estimation and planning of the project,  NOC managing director Chandika Prasad Bhatta said, adding that the NOC hass asked the IOC to contruct the pipeline to realise Modi’s promise.

Modi has also promised a line of credit of $1 billion for development projects. “But NOC asked the IOC officials not to link the pipeline project with line of credit,” he added.

Bhatta – who led the six-member NOC team in the talks – said that IOC officials are positive on NOC proposal.

However, the government has to write an official request letter to the Indian government for the construction of 43-km petroleum pipeline as a gift.

Last week, a 12-member IOC team visited Kathmandu to discuss the modality of the project.

Another high-level IOC delegation is scheduled to visit Kathmandu next week to initiate baseline work on the project.