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Tuesday, 18 June 2013

Nepal-India cross-border petroleum pipeline in the works

Nepal-India cross-border petroleum pipeline in the works

Nepal Oil Corporation ( NOC ) has said it has initiated the process of land acquisition for the proposed Nepal-India cross-border petroleum pipeline.
The corporation has proposed a 200 x 300 metre land plot on the southern side of the existing Amalekhgunj depot, according to the NOC .

“The proposal has been sent to the National Planning Commission (NPC),” said NOC Acting Managing Director Suresh Kumar Agrawal.

A technical committee formed to make appropriate recommendations to the NPC — the main body looking after the much-delayed 41-km Amalekhgunj-Raxaul pipeline — has suggested using right alignment, or about 25 metre of the right side of the Birgunj-Amalekhgunj road.

The committee led by Agrawal had submitted its report to the NPC in March. However, the project failed to make headway after the NPC vice-chairman and members tendered their resignation.

“With a new vice-chair in place at NPC, we have decided to meet soon for the project development,” Agrawal said.

The report, however, was criticised by the then NPC Vice-chairman Dipendra Bahadur Kshetry, stating it did not include any specific

details that would help the government move ahead with the project development.

“We had recommended that the project be built under the Build Operate Transfer (BOT) modality by the Indian Oil Corporation (IOC),” said Agrawal. “This way, the developer will transfer the project to the NOC after its pay-back period ends.”

According to the BOT modality, a company constructs and implements operation and maintenance of a project for a certain period before handing it over to a public entity.

Another option the committee had recommended is adopting a joint-venture modality between the NOC and IOC, which was also proposed in the past years, said Agrawal.

“As Nepal has no expertise on petroleum pipeline, the first option will be better. Besides, the IOC will also train NOC technicians.”

The government also plans to use Raxual-Birgunj-Amlekhgunj track, which was earlier allocated to a railway corridor, for the pipeline project.

The corridor has so far remained unused or encroached by human settlement. Nepal Railway owns more than 400 bighas of land in the corridor.

The project was first proposed by the IOC in 1995. On January 3, 2013, the Cabinet had agreed in principle to develop the project. Subsequently, the NPC formed a committee to look into a number of legal and technical complexities.

The project has been estimated to cost Rs 1.6 billion, excluding the costs for land acquisition.

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