Nepal to allow private firms to import fuel, oil products

KATHMANDU Wed Jan 16, 2013 2:57pm IST

Stocks

   

KATHMANDU Jan 16 (Reuters) - Nepal's government is considering allowing private companies to import crude oil products which would resolve chronic fuel shortages and end the state's monopoly on a trade worth about $1 billion a year, a trade ministry official said on Wednesday.

Nepal buys all its fuel from abroad and state-run Nepal Oil Corporation (NOC) is currently the sole importer of the 21,000 barrels per day of crude oil products the country needs.

NOC, however, is plagued by insufficient storage capacity, a poor transport network and difficulties in paying its sole supplier, Indian Oil Corp, creating frequent fuel shortages and long queues at petrol stations.

"We want to open up the petroleum business to the private sector. Private firms will be able to import, store and distribute petroleum, oil and lubricants just like the NOC does," said Lal Mani Joshi, the most senior bureaucrat at the Ministry of Commerce and Supplies and chairman of NOC's board.

A proposal to allow imports by the private sector has been submitted to the cabinet, Joshi said, adding that it was not immediately clear when it would be approved.

"When these guidelines are approved the private sector will be free to import POL products from India or any other country," Joshi said.

Private firms will initially be allowed to import cooking gas, followed by petrol and diesel, he added.

At least two private sector firms, including Malika Petroleum Company, have already applied for import permits.

"We hope we can take 10 percent of NOC's market share in the first year, and this is expected to rise up to 50 percent in five years," said Dipak Timalsena, the company's executive chairman. (Reporting by Gopal Sharma and Jo Winterbottom; Editing by Miral Fahmy)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Global Trade Deal

Global Trade Deal

Rural votes, old traumas drive India's WTO brinkmanship.`  Full Article 

E-Commerce Funding

E-Commerce Funding

E-tailer Flipkart raises $1 billion in funding.  Full Article 

Chopper Deal

Chopper Deal

Finmeccanica settles with Italy prosecutors to end Indian chopper deal probe.  Full Article 

Adani Project

Adani Project

Australia approves Adani's $16 bln Carmichael coal project  Full Article 

New Frontiers

New Frontiers

EXCLUSIVE - Goldman moves executive to new role building ETFs.  Full Article 

India-U.S. Talks

India-U.S. Talks

Kerry to woo Modi's India, but quick progress unlikely  Full Article 

Argentina Debt Default

Argentina Debt Default

Insight - Jaded Argentines brace for looming debt default   Full Article 

Anti-trust Probe

Anti-trust Probe

Microsoft targeted in apparent Chinese anti-trust probe  Full Article 

Gaza Conflict

Gaza Conflict

Israel strikes house of Hamas Gaza leader, digs in for long fight.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage