IndianOil and Nepal Oil Corporation sign B2B framework agreements for major petroleum infrastructure development in Nepal
Indian Oil Corporation (IndianOil) and Nepal Oil Corporation (NOC) have signed a Business-to-Business (B2B) Framework Agreement, enhancing bilateral energy cooperation. This agreement, building on a prior Government-to-Government MoU, supports the development of petroleum infrastructure in Nepal, including pipeline extensions and oil storage terminals. These projects aim to improve energy security, reduce transportation costs, and strengthen the India-Nepal energy partnership.
In a significant move to enhance bilateral cooperation and energy security, Indian Oil Corporation Limited (IndianOil) and Nepal Oil Corporation (NOC) signed a Business-to-Business (B2B) Framework Agreement today. The signing took place in the presence of Mr. Pankaj Jain, Secretary of the Ministry of Petroleum and Natural Gas (MoP&NG), Government of India (GoI), and Mr. V. Satish Kumar, Chairman & Director (Marketing) of IndianOil. This agreement sets the stage for the development of essential petroleum infrastructure projects in Nepal. The MoU was signed by Mr. Senthil Kumar N, Director (Pipelines) with additional responsibilities as Director (Planning & Business Development) at IndianOil, and Dr. Chandika Prasad Bhatta, Managing Director of NOC.
This agreement builds on the Government-to-Government (G2G) Memorandum of Understanding (MoU) signed earlier between India’s MoP&NG and Nepal’s Ministry of Industry, Commerce and Supplies (MoICS) on May 31, 2023. The G2G MoU was exchanged in the presence of the Hon’ble Prime Ministers of both countries, reflecting the strength of the India-Nepal partnership.
During the event, Mr. Jain remarked, “The existing pipeline from Motihari to Amlekhgunj, which is being extended to Chitwan, addresses one part of Nepal’s needs, and the upcoming terminal at Jhapa is also critical due to the challenges faced by Nepal as a hill state.” He added, “The growth of our GDP, for any nation, relies on the availability of affordable and reliable fuel. These pipelines will ensure that.”
Mr. V. Satish Kumar, Chairman and Director (Marketing) of IndianQil, stated, “We are proud to enhance the India-Nepal energy partnership through this B2B framework between IndianOil and Nepal Oil Corporation. This collaboration builds on the success of the Motihari-Amlekhgunj pipeline and facilitates seamless energy connectivity, improving energy security for both countries. IndianOil is committed to the timely execution of these projects and to strengthening bilateral relations.”
The G2G MoU includes the extension of the Motihari-Amlekhgunj Petroleum Pipeline (MAPL)—South Asia’s first transnational petroleum product pipeline, commissioned in 2019—to Chitwan, Nepal. The MoU also encompasses the construction of oil storage terminals in Chitwan and a new transnational pipeline from IndianQil’s facility in Siliguri to Jhapa, along with an oil storage terminal in Jhapa. These initiatives are expected to revolutionize petroleum logistics between the two nations, designed to meet Nepal’s future energy needs with adequate storage capacity at both the Chitwan and Jhapa terminals.
The B2B Framework Agreement signed today allows IndianQil and NOC to commence construction on these essential projects. This partnership is vital for optimizing petroleum product transportation, significantly reducing costs for Nepal Oil Corporation by lessening reliance on tank trucks. Additionally, the infrastructure is intended to minimize handling losses and environmental risks, ease border congestion, and bolster Nepal’s energy security—particularly during natural disasters like floods and landslides.
The signing of this B2B Framework Agreement heralds a new chapter in the India-Nepal energy partnership, further reinforcing the long-standing relationship between the people of India and Nepal.
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