Kathmandu: Nepal Oil Corporation (NOC) has formally commenced the construction of its second cross-district petroleum pipeline project. a 62-kilometre pipeline from Amlekhgunj to Lothar in Chitwan, under its broader petroleum infrastructure expansion plan.
The groundwork officially began last Friday along the banks of the Rapti River in Lothar, where NOC’s Project Chief Pradeep Yadav inaugurated the project by opening the new pipeline office.
The state-owned corporation had earlier acquired 23 bighas, 12 kathhas and 3 dhurs of land in Rapti Municipality-1 back in 2016 at a cost of over Rs 710 million for the project.
This second phase of the pipeline will connect to the already operational Motihari-Amlekhgunj pipeline, allowing petroleum products to be pumped directly from Amlekhgunj to Chitwan. A large Greenfield Terminal with a storage capacity of 91,900 kilolitres will also be constructed in Lothar.
According to Project Chief Yadav, the Indian Oil Corporation (IOC) has already completed the Detailed Project Report (DPR). The pipeline will be 10.75 inches in diameter and will operate under a pressure of 173.5 kg/cm², delivering petroleum at a rate of 273 kilolitres per hour.
The overall cost of the pipeline, terminal, and associated storage facilities is estimated at ₹ 8.81 billion (Rs 14.09 billion). The DPR also outlines that a 160-square-metre pipeline station will be constructed in Lothar.
“This pipeline will reduce the cost of internal transportation of petroleum products like petrol, diesel, kerosene, and aviation fuel via tankers and help control fuel theft,” said Yadav. “We aim to complete the entire project within three years.”
The pipeline is part of a G2G understanding between Nepal and India, signed during Prime Minister Pushpa Kamal Dahal’s visit to India in May 2023, in the presence of Indian Prime Minister Narendra Modi. A more specific Business-to-Business (B2B) agreement was signed on 4 October 2024 between NOC Executive Director Dr Chandika Bhatt and IOC Director Senthil Kumar in New Delhi.
According to the B2B agreement, India (IOC) will fund the pipeline installation from Amlekhgunj to Lothar, costing ₹ 2.68 billion (Rs 4.28 billion).
Nepal Oil Corporation will cover the Greenfield terminal and storage construction, at a cost of ₹ 6.13 billion (Rs 9.8 billion), with India providing technical support.
The Greenfield terminal will include: Petrol storage: three tanks of 11,000 kilolitres each, totaling 33,000 kilolitres, Diesel storage: three tanks of 15,500 kilolitres each, totaling 46,500 kilolitres, Kerosene storage: two tanks of 800 kilolitres each, totaling 1,600 kilolitres, Aviation fuel: three tanks of 3,600 kiloliters each, totaling 10,800 kilolitres.
In addition, the facility will feature two Transmix tanks of 250 kilolitres each (total: 500 KL), four underground tanks for different fuel types, each with a capacity of 50 kilolitres, totaling 200 kilolitres.
Once completed, the pipeline will significantly enhance Nepal’s fuel supply chain, reducing reliance on road transport, minimizing environmental risks, and ensuring better fuel security. It also complements regional energy cooperation between Nepal and India.
The project’s completion deadline has been set at 54 months from the signing date, under the current B2B framework.
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