Nepal Oil Corporation Accelerates Petroleum and LPG Pipeline Projects in Collaboration with India

Nepal Oil Corporation (NOC) is rapidly advancing petroleum and LPG pipeline projects in collaboration with India. The Amlekhganj–Chitwan pipeline and the Siliguri–Jhapa (Charali) pipeline projects have entered the implementation phase, while NOC has proposed to the Indian government to advance the Motihari–Sarlahi LPG pipeline project under a grant.

NOC Executive Director Chandika Prasad Bhatt informed that the Amlekhganj–Chitwan pipeline project has progressed. The pipeline will span approximately 62 kilometers with a capacity of 2 million metric tons. The construction cost will be covered by Indian Oil Corporation under a grant from the Indian government. The total estimated cost of the two pipelines is around NPR 15 billion. Meanwhile, the storage depot in Chitwan will be built using NOC’s own budget, costing about NPR 8 billion. Fuel such as petrol and diesel will be supplied from Amlekhganj to Chitwan through this pipeline, connecting with the Motihari–Amlekhganj pipeline.

The Siliguri–Jhapa pipeline project will be about 50 kilometers long, with an estimated cost of NPR 9 billion. According to Bhatt, Indian Oil Corporation will construct the pipeline and a storage terminal in Jhapa under a grant. This project entered the implementation stage after a framework agreement between Nepal and India in October 2024. The total cost for the two projects is expected to be around NPR 15–16 billion from the Indian side. Once operational, it will meet the fuel demand of Koshi Province and reduce transportation costs.

Bhatt told News Agency Nepal, “The Amlekhganj–Chitwan pipeline, including the storage depot, will cost around NPR 15 billion. The pipeline will span 62 km, and the depot will have a capacity of 91.8 million metric tons. The Siliguri–Jhapa pipeline project is estimated at NPR 9 billion. Indian Oil Corporation will construct both pipelines and the depot in Jhapa, while the Chitwan depot will be built using NOC’s budget, costing about NPR 8 billion. Once completed, fuel will be supplied from Amlekhganj to Chitwan via the pipeline.”

Plans to Import LPG via Pipeline from India

Currently, LPG imported from India is transported by trucks or bullets, costing Nepal around NPR 6 billion annually, mostly going to Indian transporters. To save costs and ensure easier supply, NOC plans to bring LPG through a pipeline.

Bhatt explained that a pipeline will be constructed from Motihari (India) to Sarlahi, with a storage facility for 15–20 days’ supply. LPG will then be distributed to industries and bottling plants using Nepali transport vehicles. The preliminary cost of this project is estimated at around NPR 12 billion. Once completed, transportation costs will significantly reduce, LPG prices will be cheaper, seasonal shortages will be eliminated, and distribution will become smoother.

Currently, LPG is supplied to Nepal using 500–600 Indian trucks annually, costing NPR 6 billion, all going to Indian transporters. Since Nepal lacks its own fleet, pipelines will help cut this cost. The plan is to build a large storage facility at Sarlahi, enough for 15–20 days, and distribute LPG to industries via Nepali vehicles. This will lower transportation costs, save billions within Nepal, and ensure smooth distribution.

The project is still in the proposal stage. NOC has requested the Indian government to construct it under a grant. Once a response is received from India, work will proceed. If India is not ready, Nepal is capable of advancing the project independently.