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Environmental assessment being done for cross-border oil pipeline

  • Uninterrupted fuel supply
- Post Report, Kathmandu

Jul 27, 2017-An environmental impact assessment (EIA) is being done for a cross-border oil pipeline that Nepal Oil Corporation (NOC) plans to build to ensure uninterrupted fuel supply and reduce dependency on often unpredictable tanker transport.

The EIA is expected to be completed in six months. Construction of the Rs4.4-billion Nepal-India pipeline is expected to take 30 months. Work should have begun last January, but sluggish official procedures have delayed the project.

The government has labelled the oil pipeline a national priority project in a bid to speed up progress. According to NOC officials, a consultant was hired to do the EIA after receiving the go-ahead from the Ministry of Forest and Soil Conservation.

Government regulations require an EIA to be done for all infrastructure construction projects. The EIA analyses the effects of development activities on the environment. 

The planned oil pipeline will have a road-to-road alignment. It will run alongside the Amlekhgunj-Pathlaiya road for 26 km. A 12 km section of the pipeline will pass through forests.

A joint study carried out earlier by NOC and Indian Oil Corporation (IOC) had shown that 25,000 trees would need to be cut down and 2,100 electricity poles shifted. Likewise, nearly 4,000 settlements located on the path of the pipeline would need to be cleared.

According to NOC sources, the corporation is now in the process of obtaining approval from the Department of Roads. The department has asked NOC to deposit Rs80 million to obtain the permit. Meanwhile, NOC has also has started the process of leasing land owned by long-defunct Birgunj Sugar Factory to construct a parking yard. 

NOC said it would be informing IOC about the progress achieved after the EIA report is completed. “It will allow the Indian counterpart to initiate the construction work,” said the source. 

As per NOC officials, IOC has started the process of procuring pipes required for the project. “It has called for bids to hire contractors to coat the pipes and carry out other safety measures.  

IOC had proposed building the cross-border pipeline in 1995. Subsequently, a memorandum of understanding was signed between NOC and IOC in September 1996 at the junior executive level. In 2004, the two sides struck another deal at the chief executive level. In August 2015, Nepal and India signed a memorandum of understanding for the construction of the oil pipeline.

The pipeline is expected to reduce transportation costs by as much as 50 percent, control leakage and ensure hassle-free transfer and quality of petroleum products. 

Out of the estimated cost of the project of Rs4.4 billion, IOC will be providing Rs3.2 billion as a grant. The remainder of the cost is for the upgradation of NOC’s Amlekhgunj depot for which it will be picking up the tab.

Published: 27-07-2017 08:32

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