Nepal wants pipeline as a gift from India

Nepal wants the petroleum product pipeline proposed by Prime Minister Narendra Modi as a ‘gift’ from India. However, the Himalayan nation is not willing to offer a 25 year exclusive contract to Indian Oil (IOC), which will lay the 41 km pipeline between the neighbours.

“Nepal considers the entire project as a ‘gift’ from India and does not want to use the line of credit available to it for this project. They also do not want to give IOC the exclusive right for supply of petroleum products through this pipeline and do not want to tie themselves down to a 25 year agreement,” a senior government official has told press.

The proposal is to construct a product pipeline from Raxaul (Bihar) in India to Amlekhganj in Nepal. This pipeline would eliminate the need for transportation of petrol and other petroleum products across the border via tankers. Of the 41 km pipeline, about 39 km would lie in Nepal. At the same time, the Raxual depot would have to be upgraded and linked to the Barauni refinery through Motihari depot.

According to the proposal mooted by India, the estimated cost of laying the pipeline would be around R150 crore, which IOC will bear. But, the PSU firm in return would seek a long-term agreement for 25 years with Nepal Oil Corporation (NOC) to operate the pipeline.

It is reported that there are 250 tankers ferrying petroleum products on the Amlekhgunj-Raxaul route and there are also a number of tankers ferrying petroleum products from Siliguri (India) to Biratnagar Depot of NOC.

Edited from various sources by Elizabeth Corner

Sources: Financial Express, The Himalayan Times

Read the article online at: https://www.worldpipelines.com/business-news/09122014/nepal-wants-pipeline-as-a-gift-from-india/