A Fuel Lifeline for Nepal

Nepal’s decision to build a nearly Rs 10 billion fuel depot at Lothar in Chitwan is a welcome move for a country that has long lacked a modern depot and depended almost entirely on its southern neighbor for petroleum supplies through tanker trucks. The project is about more than adding storage tanks. It addresses a fundamental weakness in Nepal’s fuel system: limited storage, heavy reliance on road tankers, and a distribution network that quickly comes under strain when transport is disrupted. The depot, being built by Nepal Oil Corporation, will have a capacity of 91,900 kiloliters for petrol, diesel, kerosene, and aviation fuel. Spread across more than 23 bigha, the greenfield terminal will be Nepal’s largest fuel storage facility once completed. It will also include modern truck-loading facilities, reserve tanks, and a large water reservoir for fire safety. The bigger development, however, is the extension of the Motihari–Amlekhganj petroleum pipeline to Lothar. The 10.65-inch pipeline will be able to carry up to 273 kiloliters of petroleum products an hour, or around two million tons a year. India will provide an estimated Rs 4.29 billion grant for the pipeline extension, while Nepal Oil Corporation will finance the storage infrastructure. The project is expected to strengthen supplies to Kathmandu Valley, Pokhara, and other major consumption centers. That pipeline connection is important because Nepal’s fuel system remains heavily dependent on tanker trucks even after the Motihari–Amlekhganj pipeline came into operation.