IOC agrees to Nepal's proposal of a five-year oil supply contractStaff writer ▼ | February 6, 2015
Indian Oil Corporation (IOC) has agreed to Nepal's proposal of a five-year oil supply contract agreement, paving the way for the construction of the much-delayed Nepal-India petroleum pipeline. Earlier, the IOC had been insisting on a 15-year agreement.
Oil The IOC had been insisting on a 15-year agreement
Receiving the draft, the Ministry of Commerce and Supplies has started consultations with the Ministry of Finance and Ministry of Foreign Affairs, the source said. Proposing a five-year contract, the NOC had argued it would be difficult for if it had to award the oil supply contract to suppliers other than IOC in future. Currently, the two countries review the supply agreement every five years.
The long-awaited project got momentum after Indian Prime Minister Narendra Modi's spoke about the construction of the pipeline during his Nepal visit in August.
The IOC has agreed put in IRs 5.5 billion for the construction of the 41-km pipeline that will supply petroleum products from IOC's depot in Raxaul to NOC's depot in Amlekhgunj. ■