Government considers halting fuel import permit issuance

Kathmandu January 11- Department of Commerce and Supply Management (DoCSM) is considering halting the issuance of temporary petroleum import licences to private firms as most of licenced firms have failed to bring in fuel.

Of the 25 firms acquiring the permit, only two have so far managed to import fuel. Petrolimax Nepal has been importing aviation fuel and selling to Nepal Oil Corporation (NOC), while Birat Petroleum has landed in controversy due to high price of the petroleum products it has imported.
“As most of the companies receiving the temporary licence have failed to import fuel, we are considering halting the issuance of such permits,” said Deepak Pokharel, an officer at DoCSM.

Over the last month, eight private companies acquired the licence. They are Arbind Emporium, Shuva Sambriddhi Tradersm, Karmam Bhagyam Company, Leo GasUdhyog, Talk Nepal, Houinchhi International, Omni Business Corporate International and Energy Trade Technology. Of them, Omni Business and Energy Trade have forwarded their business plans to import fuel via land route from China.

Earlier, 17 private companies had received the permit. They include Birat Petroleum, Bala Trade Link, Tayal International, Otex International Nepal, Aryan Petrochemicals Trading, Blue Lotus Enterprises, Down Town Investment, MIG Holding, Orange Trade and Events, Progiochem Industries, Petrolimex Nepal, Banquet Queen Investment, Koshi Petrochemicals, Fujima Oil, Bhagawati Traders, Neprash International Company and Nepa Petroleum Trade Links.

The government allowed the private firms to import fuel in line with the Petroleum and Gas Transaction Regulation Order 2013.

As per the order, companies willing to import fuel should maintain a paid-up capital of Rs5 billion within two years from the date of licence issuance. They should maintain Rs250 million, or 5 percent of the capital requirement, in the initial stage.

The companies should also have at least 14,000-litre diesel storage capacity, 6,000-litre petrol and 1,000-litre kerosene. In addition, they should reveal their distribution network in their business plans.

The price of imported petroleum could be fixed on the basis of prices prevalent in the international market. The quality of the fuel the private firms would sell would be monitored jointly by the DoCSM and Nepal Bureau of Standards and Metrology.