Fuel Overview 

Nepal Oil Corporation Limited (NOC) established in 1970 by the Government of Nepal under the "Company Act, 2021 (1964), is a state-owned trading enterprise of Nepal that imports, stores and distributes various petroleum products in the country. In Nepal, no private or other companies are allowed to import Petrol and Diesel other than NOC. Being a landlocked country, all fuel products in Nepal are imported via India under the special agreement with Indian Oil Corporation (IOC). NOC, headquartered in Kathmandu, has over the years expanded and now has seven Provincial offices in each province of Nepal. Three branch offices, two fuel depots, One Petrol Pump, and Ten aviation fuel depots, with total existing storage capacity of 68,427 kilolitres (kl), which is assessed to be enough for 20 days based on national sales data.   

NOC distributes its petroleum products to various government affiliated and NOC approved privately owned companies to be distributed to consumers.  Currently, NOC is working towards developing storage facilities for petroleum products to meet the demand of at least 30 days. All aviation fuel (Jet A-1) is distributed and sold directly by NOC through eight Aviation Fuel Depots to adhere to stringent quality control measures. 

The current storage capacities of the Fuel depots of the country are as follows: 

Source: Storage Facilities (noc.org.np) 

Links to the authorized dealers and retailers Details: 

• Koshi Province 

• Madhesh Pradesh 

• Bagmati Province 

• Gandaki Province 

• Lumbini Province 

• Karnali Province  

• Sudurpaschim Province  

For more information on government and fuel provider contact details, please see the following links: 4.1 Government Contact List and 4.7 Fuel Providers Contact List. 

Fuel Pricing 

NOC has implemented Automatic Petroleum Pricing Mechanism (APPM) since 29th September 2014. To cushion consumers against an oil price shock, the government has seeded a Price Stabilisation Fund with NRs500m (approx. USD 3.7m). If petroleum product prices rise by more than 2%, the NOC will draw on the fund to moderate the increases passed on to consumers; if prices decrease by more than 2%, the NOC will make deposits into the fund to build it up against future negative shocks. 

*Selling Price of Petroleum Products in Kathmandu Valley (Inclusive VAT) as of   February 12, 2024 Exchange rate 1 USD: 132.814 NPR as of February 12, 2024 

Seasonal Variations  

Fuel worth NPR  353 billion (USD 2.65 billion approx.) was imported in the fiscal year 2022/23. Import of fuel has gradually increased for the last couple of years due to the increase in the consumption of fuel, as per a spokesman NOC. During monsoon, because of reasons like bad road conditions due to continuous rain and due to lessened developmental activities, the import of fuel is lower.  

Fuel Transportation 

The Motihari-Amlekhgunj pipeline is 69 kilometre (42.9 mi) long oil pipeline from Motihari, India to Amlekhgunj Depot in Parsa, Nepal. This pipeline makes the transportation of oil across the border from India easier, safer and faster to Nepal. It is the first trans-national pipeline in the Indian sub-continent operated by Indian Oil Corporation Limited. Currently, the pipeline is used for the import of diesel. 

The pipeline was jointly inaugurated by Prime ministers of India and Nepal on 10 September 2019. 

The products are transported from IOC refineries, terminals, and depots to the corresponding NOC depots and retail dealers by tank trucks. There is a total of 494 transporters across the country and 1,893 tank trucks are available.  

NOC does not have its own transportation provision. A bilateral contract with the transporter is the basis for all the product delivery orders to be sent out to Indian Oil Corporation (IOC) depots carried along by each oil tanker. From the IOC’s depots with respect to the capacity of the tankers, either 12 KL or 20 KL fuel is carried back to the respective depots after necessary clearance procedure at the customs.   

However, in several instances, fuel transporters are often the cause of supply bottlenecks. Fuel tankers, which are mainly private owned, are the only transporters of fuel in the country, hence, fuel tanker association strikes/protests often lead to halt in the supply of fuel resulting in a fuel crisis.  

Link: Tank Truck detail of all provinces 

Standards, Quality, and Testing 

With the help of IOC, NOC has been able to train employees in the field of quality and pollution control, stock loss control, fire and safety precautions during operations, engineering, as well as in the detection, control and countermeasures against adulteration and required laboratory test procedures and methods. 

A Quality & Pollution Control Department at Babar Mahal, Kathmandu has been set up to constantly monitor fuel standards.  The central laboratory is equipped with necessary facilities for testing of quality standards of petroleum products. Laboratory testing is regularly carried out and quality norms are strictly enforced. NOC also frequently arranges for its inspection team to check adulteration and maintain the standard of petroleum products available in the market. 

Disclaimer: Inclusion of company information in the LCA does not imply any business relationship between the supplier and WFP / Logistics Cluster, and is used solely as a determinant of services, and capacities.  

Please note: WFP / Logistics Cluster maintain complete impartiality and are not in a position to endorse, comment on any company's suitability as a reputable service provider. 

Sources: 

1. Nepal introduces a new oil pricing mechanism, new oil pricing mechanism 

 2. NOC Audit report 2079-80