Nepal will propose extension of the Mothihari-Amlekhgunj petroleum pipeline up to Chitwan with India during the first meeting of the Nepal-India Joint Working Group on Petroleum and Gas scheduled to being in Kathmandu on Wednesday, officials said.

Construction of the petroleum pipeline from Raxaul to Amlekhgunj has already started. According to Nawaraj Dhakal, joint-secretary at the Ministry of Commerce and Supplies who leads the Nepali delegation to the meeting, said Nepal will seek extension of three pipelines—natural gas, liquefied petroleum gas and oil (petrol, diesel and kerosene)—up to Chitwan.

In 2015, the two governments signed an agreement to lay a 69-km oil pipeline from Motihari in India to Amlekhganj. This time Nepal will seek extension of the natural gas and LPG pipelines along the same route.

“Natural gas is instrumental to manufacturing chemical fertilizer,” said Dhakal. Nepali officials are also seeking extension of the Indian LPG facilities from Mujjafarpur that India is currently working on.

“Infrastructure building of Nepal Oil Corporation (NOC) will also be discussed at the meeting,” he added.

During the recent visit by Commerce Minister Matrika Prasad Yadav, India agreed to build a gas pipeline to Nepal. Yadav visited New Delhi in the first week of September and held talks with India’s Union Minister for Petroleum and Natural Gas Dharmendra Pradhan. The two countries had agreed to discuss the modality of construction at the joint working group meeting.

Indian Minister Pradhan is visiting Kathmandu on Friday. If there are positive developments at the meeting, the two sides will sign an agreement on gas pipeline expansion.

“The joint-secretary-level meet will discuss possible alignment and construction modality of the pipeline,” said Dhakal.

Ministry sources said India had given its nod to laying a pipeline connecting Motihari, India, and Amlekhgunj or Chitwan, Nepal. India said it may start construction after the project to extend the pipeline to Motihari is completed, according to Dhakal.

India is currently building the oil pipeline between Motihari and Amlekhgunj. So far, a 17km stretch of the 36.2-km section of the pipeline, which lies on the Nepal side, has been over, according to the NOC. The pipeline runs along the Birgunj-Pathlaiya road which is being expanded into a six-lane highway.

Nepal’s fuel imports have rocketed in recent years. Last fiscal year, the demand for cooking gas surged 18 percent to 370,560 tonnes, according to the NOC. The gas pipeline will result in savings of around Rs2 billion annually for Nepal by eliminating tanker trucks. Diesel and cooking gas accounted for 80 percent of the total fuel import bill of Rs170 billion last fiscal.

The Kathmandu JWG meeting would fix the date for conducting a pipeline feasibility study. According to him, the meeting is also expected to decide on the issue of Nepali gas bullets getting access to India’s refineries.

India has been reluctant to issue the explosive licence to Nepali gas bullets saying that the country’s laws do not

permit movement of Nepali cargo trucks. Nepali entrepreneurs are said to have procured 52 gas bullets after obtaining approval from the oil monopoly.