KATHMANDU, Dec 10: Diesel shortage has hit the implementation of large development projects, including national-priority projects like Mid-hills Highway and Sikta Irrigation Project, among others. The problem is further accentuated by the daily 6-hour long power-cut.
Diesel supply is scarce for over a week now as Nepal Oil Corporation (NOC) reportedly failed to clear its dues to its sole supplier Indian Oil Corporation (IOC) and IOC in turn cut down on the supplies. [break]
At present, NOC is incurring a loss of Rs 1.26 billion a month. "IOC is supplying only 60 percent of the regular quantity that we need to maintain normal supplies," said an NOC source.
Sadly, such poor management of the much-needed fuel has hit the transportation of construction materials and operations of heavy equipment at different project sites -- mainly big ones, said Ramesh Sharma, former president of Federation of Contractors´ Associations of Nepal (FCAN).
"The fuel was on a short-supply for a month. But since one week, the supply has completely dried up as NOC did not release required fuel to the projects," he told Republica. In order to push the state-owned petroleum monopoly to resume normal supplies, contractors are planning to approach NOC requesting it not to cut down on the diesel supply, which is crucial for the development works that have just begun catching momentum.
Yaksha Dhoj Karki, proprietor of Sky Builder which is involved in the construction of Bagmati Irrigation Project, said fuel-shortage has hit the construction work at the project he is implementing. "If the situation persists, a timely implementation of the project will be in question," he stated.
"Construction works in postal roads in Tarai, Pushpa Lal Mid-Hills Highway and irrigation projects such as Sikta, Sunsari-Morang, Bagmati, Babai and Mahakai as well as dozens of other rural road projects initiated by local consumers groups are all reeling under fuel crisis," he said.
According to government records, more than a hundred excavators, around 200 trippers, 60 rollers, around one-dozen pre-mix asphalt plants are presently engaged in big projects across the country. Apart from that, over 200 excavators are in use in different rural roads being constructed by local consumer groups.
Suresh Kumar Agrawal, acting managing director of NOC, said supplies to big projects have been slashed significantly due to short-supply of fuel. “Demands from different projects have gone up. However, we are not in a position to supply them as much fuel as they want. It will create unbearable crisis in the market,” said Agrawal.
According to Mukunda Dhungel, spokesperson of NOC, the corporation is presently supplying as much as 60 percent of total volume that big projects have demanded. Amid lack of finances to ensure enough imports, NOC is presently importing less fuel and distributing just around 2,000 kiloliters (KL) of diesel a day against the demand of 3,000 KL in the country.