Kathmandu, January 24
The Ministry of Supplies (MoS) has sought Rs 62 billion from the government to expand petroleum storage capacity in the country to meet the market demand for three months.
In a meeting held at the Office of Prime Minister and Council of Ministers (OPMCM) today, Supplies Minister Deepak Bohara informed Prime Minister Pushpa Kamal Dahal that the government should provide Rs 30 billion to develop petroleum storage infrastructure to cater the demand of at least three months and Rs 32 billion to purchase petroleum products (petrol, diesel, kerosene, LPG) that will remain in stock for the same period.
“We calculated that Rs 62 billion would be required to expand current storage capacity of petrol, diesel, kerosene and LPG to cater to demand of three months and have urged OPMCM and Ministry of Finance (MoF) to release the budget for the purpose,” Bohara informed The Himalayan Times, adding that Prime Minister Dahal and MoF have principally agreed to support MoS to expand petroleum storage by releasing the required budget.
However, as per earlier calculation of Nepal Oil Corporation (NOC), Rs 117 billion would be needed to increase the petroleum storage capacity as planned by the government.
Sushil Bhattarai, deputy managing director of NOC, clarified that estimation of MoS is without the budget required for land acquisition and of LPG storage for only one month.
“As the prime minister and finance ministry have principally agreed to release the required budget, we believe that work process of developing petroleum storage capacity in all seven provinces will begin soon,” added Bohara. He also informed that MoS will finalise the construction modality of petroleum storage across the country within a few weeks.
Nepal currently has reserve capacity of 5,184 kilolitres (kl) petrol, 42,400 kl diesel, 15,500 kl kerosene and 8,500 kl aviation turbine fuel (ATF). This storage is able to fulfil the domestic demand for three to four days. If fuel storage capacity is to be increased targeting three month’s consumption in Nepal, the current reserve capacity of petrol has to be expanded to 135,000 kl and that of diesel to 405,000 kl, according to NOC.
Similarly, reserve capacity of kerosene and ATF has to be upgraded to 5,100 kl and 60,000 kl, respectively. Also, LPG reserve capacity has to be increased to 120,000 metric tonnes to meet three month’s demand.
Meanwhile, MoS also informed the government that it was planning to present a proposal to Indian Oil Corporation to extend Raxaul-Amlekhgunj Petroleum Pipeline from Motihari of India to Chitwan.
A version of this article appears in print on January 25, 2017 of The Himalayan Times.