Govt to issue new guidelines to end NOC monopoly
KATHMANDU, JAN 11 -
The government is set to issue new guidelines on private players’ entrance into petroleum business to break Nepal Oil Corporation’s monopoly in the market.
Addressing the 43rd anniversary of the Nepal Oil Corporation ( NOC ), Commerce Secretary Lalmani Joshi said that Nepal being a member of World Trade Organisation cannot bar the private sector’s entry into petroleum business. “The government is working on new guidelines to allow private players in petroleum trade,” said Joshi, who also revealed that the Commerce Ministry has recently formed a committee to study necessary requirements to attract private players into the trade. “Breaking the petroleum monopoly is the need of the hour.”
With NOC ’s loan ballooning to Rs 27.51 billion, the state-owned monopoly is hoping that the enforcement of colour-coded liquefied petroleum gas (LPG) cylinder in the market will help the NOC to turn around its fortune. “The NOC will start earning profit soon after the dual LPG cylinder is enforced,” said Joshi.
The NOC , which has taken out a total of Rs 27.51 billion in loan from the government and different financial institutions and banks, pays annual interest of Rs 2.04 billion.
Besides, the Commerce Ministry has asked Finance Ministry to raise NOC capital and allocate price stabilisation fund to control price shock to check on price fluctuation in the international oil market.
National Planning Commission (NPC) Vice Chairman Dipendra Bahadur Kshetry said that a committee under his chairmanship is studying on the cross-border petroleum pipeline under the Build, Own, Operate and Transfer (BOOT) model. “We will soon submit a report to the government,” Kshetry said, adding that another committee has been formed to prepare a petroleum price mechanism policy.
Baburam Rai, president of Nepal National Employees’ Union at NOC , said although enforcement of dual LPG cylinder had been planned a year ago it has not been implemented yet. “The government and the LPG bottlers are fooling the public,” Rai said, accusing the NOC management and the government of bowing to pressure from LPG bottlers, who are reluctant to enforce the system.
According to NOC statistics, demand of petroleum products in Nepal has grown by 20 percent for the past couple of years. Higher energy consumption due to increase in load shedding hours has made petroleum products the country’s number one import. Nepal’s gasoline import bill jumped 27.2 percent to Rs 96.38 billion in 2011-12.
Source: The Kathmandu Post
