The state-owned petroleum monopolist has asked the Indian supplier to supply it 103,000 kiloliters (KL) of fuel in September, 25 percent higher than what it had imported in August. It has also requested the IOC to supply 18,000 tons of liquefied petroleum gas (LPG) this month, which is higher than normal monthly imports of 15,000 tons.[break]
“We have also requested the IOC not to cut or obstruct the supplies, informing it about the festival when we can´t make any compromise on supply,” said NOC Spokesperson Mukunda Dhungel.
The demand for fuel rises sharply during Dashain, which is starting from September 28, as a large number of people travel to different parts of country to celebrate the festival.
Dhungel said the major chunk of the additional supply will go for fulfilling the festive demand, while the rest will be maintained in buffer stock for festivals that follow Dashain.
Latest report of NOC shows that the corporation presently has 25,000 KL of petroleum products in stock. Of the total stock, corporation´s depot at Thankot, which supplies fuel to the Kathmandu Valley, has well over 1,450 KL of petrol and 4,000 KL of diesel in stock.
Although it is just enough to fulfill the national demand for about a week, Dhungel said it will not impact the supplies as the corporation was receiving strong supply from IOC over the past one week.
“The import has helped us not just to replenish the stock distributed in the market every day, but also to increase the volume of fuel in store,” he stated.
NOC will need to pay Rs 6.80 billion (IRs 4.25 billion) to the Indian supplier, which is almost Rs 2 billion higher than what it paid in August, for the additional supplies that it has requested.
But given that the corporation has been consistently facing loss due to apathy of the government to adjust domestic retail rates in line with the international rate, it has estimated that it will fall short of cash worth Rs 864 million to finance the import.
Nonetheless, the corporation has promised the Indian supplier that it will make payment in a regular manner. It has already released Rs 1.52 billion (IRs 950 million) as the first tranche of payment.
Initially, the NOC had requested the government for loans to manage the deficit fund. But after the government´s refusal, it took Rs 400 million in loans from Nabil Bank.
“This has helped us to manage payment. We are also prepared to take additional loans, if required to ensure smooth supply during festive season,” said Dhungel.
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