Nepal, India sign petroleum pipeline deal

While, Nepal Oil Corporation will invest 75 crore to develop additional facilities in Amlekhgunj depot.

The MoU was signed for construction of 1.3 MMTPA capacity Raxaul-Amlekhgunj petroleum product pipeline alongwith some works at Amlekhganj Petroleum Depot of NOC.

It may also be noted that this would be the first transnational petroleum pipeline in South Asia and will be a significant step towards Hon’ble Prime Minister’s vision of improved regional connectivity among SAARC countries.

The much awaited Nepal-India petroleum pipeline project is set to take-off with the signing Kathmandu on Monday of an MoU for construction of the 41-km Amlekhgunj-Raxaul petroleum pipeline with Indian assistance.

Minister of State for Petroleum an Natural Gas Dharmendra Pradhan will leave on a three-day visit for Kathmandu today. Petrol, diesel, domestic LPG and jet fuel (ATF) are now trucked from IOC’s depot at Raxaul to Nepal. It will facilitate smooth supply of petroleum product from between the two countries.

The 41-kilometer-long pipeline (two kilometers in India and 39 kilomters in Nepal) which will initially supply petrol, diesel and kerosene will be constructed by Indian Oil Corporation at a cost of approximately Rs.

The IOC will bear an expense of INR 200 crore for the first phase of the project.

Fuel shortage has been a chronic problem in Nepal with political parties often calling strikes and hindering the import of petroleum products. The bulk of this volume will be transported through the pipeline.

The Amlekhgunj-Raxaul project is expected to take 30 months to complete following approvals from the Nepalese Government. The pipeline was to be funded 50:50 by IOC and Nepal Oil Corp (NOC). IOC has also underlined a condition under which Nepal will buy petroleum products for at least 15 years in exchange for its major chunk of investment.