SAARC Diary: Indian Oil Corporation Helped Nepal Oil Corporation Save Rs. 1.5 billion in Transportation Cost
NEW DELHI, Jan 2: The Nepal Oil Corporation saved more than Rs 1.5 billion in transportation cost because the Indian Oil Corporation (IOC) dispatched the petroleum products to the Himalayan country through the 69-kilometre long petroleum pipeline from Motihari, India to Amlekhgunj, Nepal, the first in south Asia, last year.
The NOC was founded in 1970 as a government-owned company in Nepal having the monopoly to import, store and distribute various petroleum products in the region and is totally dependent on India for import of refined petroleum products.
The IOC on behalf of the NOC purchased 1,893 tank trucks of petroleum products which were distributed by NOC in Nepal through 1563 privately-held retail outlets. According to the annual financial statement of the company’s last fiscal year Rs. 1.47 billion was saved in transport costs.
The total demand for petroleum products in Nepal is about 1.9 million tonnes, with an annual rise of 10%. Petroleum products comprise 15% of the total energy consumed in the region. IOC has an arrangement in force with NOC for the seamless supply of petroleum products. The agreement is renewed every five years and the current agreement was signed on 27 March 2017. The IOC in December crossed the milestone of providing 100 million litres of diesel for the first time in a single month.
(Venkatesh Iyer)
