IOC begins pipe procurement process for pipeline project

NOC says global tender for construction works will be called soon

Kathmandu, April 26

The Indian Oil Corporation (IOC) has begun the pipe procurement process for the much-hyped Raxaul-Amlekhgunj petroleum pipeline, finally giving momentum to the project.

In the third week of March, IOC called for a global tender for the procurement of pipes to be laid along the finalised route of the 37.6-kilometre cross-border oil pipeline project. The selected company will be responsible to manufacture the pipes to be laid as per the standard set by IOC.

Both IOC and Nepal Oil Corporation (NOC) have agreed to lay 12-inch thick pipes along the finalised route of the oil project.

Sushil Bhattarai, the Nepal coordinator of the Raxaul-Amlekhgunj oil pipeline project, informed that IOC is expected to select the pipe manufacturer within less than a month. “Once the pipe manufacturing process gathers pace, the IOC will eventually announce another global tender for construction of the oil pipeline,” informed Bhattarai, who is also the deputy managing director of NOC.

According to him, the initial process of laying the cross-border pipeline started to gather momentum especially after Nepal accelerated clearing encroached public areas along the finalised route of the project.

The Detailed Engineering Report (DER) of the Raxaul-Amlekhgunj pipeline, which was prepared by Indian consultant company — SM Consultant — in October last year, has finalised Birgunj Customs-Birgunj Bypass-Gandak-Parwanipur-Jitpur-Simara-Pathlaiya-Amlekhgunj as the route of the project.

“With good coordination of different government bodies lately, majority of encroachments along the route has been cleared. Similarly, NOC has also acquired all the approvals of related government bodies that are necessary for the pipeline project,” Bhattarai said.

He informed that the Ministry of Forest and Soil Conservation (MoFSC) has recently allowed NOC to conduct the Environmental Impact Assessment (EIA) of forest areas and areas within the Parsa Wildlife Reserve that falls along the route of the pipeline project. Similarly, the Department of Roads (DoR) has allowed pipes to be laid 22 to 23 metres away from the road. As per DER of the project, pipes along the finalised route of the project will be laid five feet below the ground.

As the oil project would snake through 33.6 hectares of land within the Parsa Wildlife Reserve, the DER states that almost 25,000 trees inside the conservation area will have to be cleared to build high-capacity petroleum storage as planned by the project.

Though Nepal and India had inked an agreement to construct the 41-kilometre cross-border oil pipeline in August 24, 2015, construction process of the project had been delayed repeatedly due to Nepal’s lack of readiness. Owing to Nepal’s failure to clear encroachments along the finalised route of the pipeline in a timely manner, that initial target of December last year had been missed.

Meanwhile, IOC has also agreed to extend the Raxaul-Amlekhgunj petroleum pipeline to Luthar of Chitwan. The overall cost of the project is estimated to stand at INR 2.75 billion. While the Indian government will inject INR two billion for the project, Nepal will invest INR 750 million. Similarly, Nepal will also have to bear the cost of expanding the petroleum pipeline up to Chitwan, as per the agreement between the two oil companies.