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

Press Event

Press Event

Modi takes tea, but no questions, in first press event as PM.  Full Article 

Monetary Policy

Monetary Policy

Finance Minister Arun Jaitley favours interest rate cut - paper  Full Article 

Sundar Pichai Elevated

Sundar Pichai Elevated

Google's Pichai to oversee major products and services.  Full Article 

Reuters Poll

Reuters Poll

India's growth pace to pick up as reforms draw investment   Full Article 

Need For Reforms

Need For Reforms

Euro zone risks "relapse into recession" without structural reforms - Draghi.  Full Article 

Diwali Sales

Diwali Sales

Gold sales jump about 20 pct for Diwali - trade body  Full Article 

World Bank Rival

World Bank Rival

Three major nations absent as China launches W.Bank rival in Asia  Full Article 

Health Of Lenders

Health Of Lenders

25 European banks set to fail health checks - sources.  Full Article 

Reuters India Mobile

Reuters India Mobile

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