DR Ambedkar IAS Academy

Motihari-Amlekhgunj Pipeline

Prime Minister Narendra Modi and his Nepalese counterpart K P Sharma Oli will inaugurate the Motihari-Amalekhgunj petroleum pipeline.

Where does the pipeline begin and end?

The pipeline will transport fuel from Barauni refinery in Bihar’s Begusarai district to Amalekhgunj in South-eastern Nepal, situated across the border from Raxaul in East Champaran district.

According to the spokesperson of Nepal Oil Corporation (NOC), the 69-km pipeline will drastically reduce the cost of transporting fuel to landlocked Nepal from India.

The Amalekhgunj fuel depot will have the capacity to store up to 16,000 kilolitres of petroleum products.

When it all did begin?

The Motihari-Amalekhgunj pipeline project was first proposed in 1996, but progress was slow.

Things began to move after Prime Minister Narendra Modi visited Kathmandu in 2014.

The following year, the two governments signed an agreement to execute the project.

However, political tensions, including India’s alleged economic blockade of Nepal, acted as roadblocks in the implementation.

In 2017, state-owned Indian Oil Corporation (IOC) signed a petroleum trade agreement to supply about 1.3 million tonnes of fuel annually to Nepal with a promise to double the volume by 2020.

In July 2019, the two countries successfully concluded a testing transfer through the oil pipeline.

What are the costs and benefits?

The project was initially estimated to cost Rs 275 crore, of which India was to bear Rs 200 crore.

Subsequently, the NOC said the total project cost had escalated to almost Rs 325 crore.

Commercial operation of the cross-border fuel project will bring down fuel price by at least one rupee per litre said the NOC Deputy Executive Director.

The pipeline will help in tackling the oil storage problem in Nepal and doing away with transportation of petroleum products through tankers.

It will ensure smooth, cost-effective and environment-friendly supply of petroleum products to Nepal.

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