Nepal | June 02, 2020

Nepal Oil Corp fails to hand over fuel supply contract

Himalayan News Service
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Nepal Oil Corporation. Photo: THT file

Nepal Oil Corporation. Photo: THT file

Kathmandu, October 16

Nepal Oil Corporation (NOC), the country’s petroleum monopoly, has failed to hand over the contract on supply of petroleum products even after five days of receiving bid documents from interested parties.

“We have not been able to shortlist a preferred bidder as most of the parties have placed various conditions to bring in oil, for which we’ll have to get the approval of the Ministry of Commerce and Supplies,” a senior NOC official said on condition of anonymity.

“For instance, a party, which has proposed to airlift fuel from China, has said the Nepal government first needs to sign a deal with the Chinese counterpart because the private company there cannot export fuel without government-to-government agreement.”

Also, bidders have quoted high prices for supply of petroleum products.

“The quoted price of petrol, for instance, is in the range of Rs 200 per litre, which is almost double the existing marketing price,” the official said, without
providing details on the highest and lowest prices quoted by different parties for different petroleum products. He, however, said almost all of the bidders have expressed interest to airlift the fuel to Nepal.

NOC had earlier called on interested parties to submit bids for delivery of petrol, diesel, kerosene, cooking gas and aviation turbine fuel for 15 days to ease fuel crisis in the country.

A total of 23 companies, including those based in China, South Korea and countries in the Gulf, had responded to NOC’s call. NOC had said even Indian Oil Corporation, which has failed to supply adequate quantity of petroleum products for Nepal, had taken part in the bidding.

The company which bags the contract must supply 200 kilolitres (KL) of diesel, 100 KL of petrol, 200 KL of kerosene and aviation turbine fuel, and 100 metric tonnes of liquefied petroleum gas (LPG) per day to NOC for a period of 15 days.

The petroleum products, excluding LPG, sought by NOC are equivalent to only 12.5 per cent of daily
supply made by NOC on normal days.

A version of this article appears in print on October 17, 2015 of The Himalayan Times.

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