Kathmandu, May 8
The longstanding petroleum crisis is likely to end as the government has proposed to restructure the state oil monopoly-- Nepal Oil Corporation (NOC) -- in various ways.
The Ministry of Commerce and Supplies (MoCS) in its programmes and policies for the next fiscal year 2069/70 has proposed a few of the measures to address the looming fuel crisis in the country.
Talking to The Rising Nepal Deepak Subedi, Joint Secretary and Spokesperson at the MoCS, said that the ministry has forwarded a few major proposals to address the petroleum crisis.
“We have proposed some major plans. The first one is to form a separate fund for the NOC. The second is to allocate annual budget for the corporation as other government bodies get to recover losses in the petroleum products. Our last proposal is to install pipe line from Raxaul to Amlekhgunj,” he said.
Similarly, the Ministry has also taken an initiative to look into the possibility of importing the crude oils directly from the Arabian countries, which will be refined by the Indian Oil Corporation (IOC).
He also said that the import of crude oils would help reduce the existing loss the NOC incurs and also at the same time help ease the petroleum crisis.
“If Nepal succeeded in importing the crude oils from the Gulf countries and refining in India, it can help make profits for the NOC even in the present context,” he said adding, “We can have more than 100 products from the crude oils.”
The IOC will take all the by-products produced while refining. The selling of the by-products also can simply generate more than Rs. 2 billion for the NOC.
According to a recently signed agreement between the NOC and IOC, the former can buy the crude oils from the Gulf countries and ask the IOC to refine them.
“For this, Nepal’s ambassador to Kuwait Madhusudan Paudel has been lobbying hard,” he revealed.
He informed that the ambassador has planed to organize a ministry-level delegation to visit Kuwait for holding talks with the concerned authorities there.
Suresh Kumar Agrawal, Acting Managing Director at the NOC, said that the corporation has proposed around Rs. 40 billion budget for various programmes aiming at dealing with the petroleum crisis.
He informed that the NOC has proposed a price stability fund of around Rs. 10 billion, Rs 18 billion to cover the annual losses, Rs. 5 billion fill the depots, Rs. 3 billion to carry out the works related to the oil pipe installation from Raxaul to Amlekhgunj and Rs. 1 billion for maintenance.
Presently, the NOC has been suffering a loss of around Rs. 18 billion from the petroleum products annually.
The cumulative loss of the NOC has reached around Rs. 19 billion, while the NOC has taken around Rs. 23.17 billion as loans.
As per the new price structure received from the IOC on May 1, the NOC could face a loss of about Rs.1.14 billion this month.
The corporation supplies around 17,000 KL of petrol, 65,000 KL of diesel, 6000 KL of kerosene, 1,250,000 cylinders of cooking gas and 10,000 KL of aviation fuels every month.
Based on the new price structure, the corporation would now suffer a loss of Rs. 10.62 per litre of diesel and Rs. 598 per cylinder of cooking gas.
However, the corporation is making a profit of Rs. 3.71 from a litre of petrol, Rs. 3.02 per litre of kerosene and 19.81 per litre of Air Turbine Fuels.