NOC’s profit increases by 4 billion rupees despite the pandemic
December 28, 2020 11:44 AM NPT
By: Dilip Poudel
KATHMANDU, Dec 28: State-owned Nepal Oil Corporation (NOC) has earned a profit of 12.87 billion rupees in the FY 2019/20, compared to a profit of 8.75 billion rupees in the FY 2018/19.
Although most of the trade and businesses suffered a heavy loss year due to the pandemic, NOC saw a decent profit. The corporation, which has a monopoly in the fuel business, has increased its profit by about 4.12 billion rupees in the fiscal year 2019/20.
The corporation has earned a profit of 12.87 billion rupees in the FY 2019/20 although the fuel business saw a decline due to the pandemic. According to Surendra Paudel, managing director of the NOC, the increase in profit is due to savings in transportation cost by importing fuel from Mahottari Amlekhgunj Petroleum Pipeline and earnings from the interest on the previous year's profit.
The corporation, which has been in debt for a long time, started making profit since the FY 2017/18. The corporation has been making profit since the fall in fuel prices in the international market in recent years and the implementation of automatic pricing system.
The corporation stated that it has saved .47 billion rupees by transporting diesel through the pipeline. It has earned 1.77 billion rupees as interest in last year's profit from the banks alone.
The corporation, which has been planning a second pipeline project and increasing storage capacity, had deposited the previous year's profit in various commercial banks. According to the corporation, it is planning to spend the profit on infrastructure development. For the first time, the corporation has prepared a balance sheet according to the Nepal Financial Reporting Standards (NFRS).
The corporation has been adjusting the price in the local market through an automatic pricing mechanism, in line with the international price. The corporation increased its paid up capital from 290 million to 11 billion in the fiscal year 2018/19.
The corporation, by trading fuel, paid 66.88 billion as revenue to the government last year. Last year, the corporation imported 2.5 million kiloliters of fuel worth 205 billion which is 11 percent less than the previous year.
Of the fees collected by the corporation under different headings, it has collected 4.99 billion from consumers in a period of five years as road maintenance fee. Similarly, 2.94 billion has been collected as pollution tax and 13.98 billion as infrastructure development tax.