The construction of the Amlekhgunj–Lothar Petroleum Pipeline Project, a project of national priority, is progressing rapidly, with land leveling and construction of the boundary wall underway at Lothar in Rapti Municipality-1, Chitwan.
Project Chief and Nepal Oil Corporation Director Pradeep Kumar Yadav said that, alongside land management for the project, the Environmental Impact Assessment (EIA) has also reached its final stage.
Under the project, a new fuel storage facility equipped with modern infrastructure will be constructed on approximately 23 bighas and 12 katthas of land at Lothar.
A system will be established to transport petroleum products from the pump house at Indian Oil Corporation’s depot in Motihari, India, to Lothar. A pipeline approximately 62 kilometers long and 10.75 inches in diameter will be laid from Amlekhgunj to Lothar.
Nepal Oil Corporation has been importing petroleum products through a pipeline from Motihari, India, to Amlekhgunj in Bara. The existing pipeline is now being extended from Amlekhgunj to Lothar.
Pipeline to Run Parallel to East-West Highway
Project Chief Yadav said the pipeline route mapping has already been completed. The plan is to lay the pipeline parallel to the East-West Highway. The corporation said necessary coordination has already been carried out with the Department of Roads.
In the Hetauda market area, the pipeline will follow an alternative route to avoid passing through the main market. The pipeline coming from Amlekhgunj will run through the middle of the river before reaching Ratmate and will emerge near the Rapti Bridge after passing Hetauda market.
Yadav said work is being carried out with the aim of completing the project within the stipulated timeframe. According to him, the target is to complete construction and bring the project into operation within the next three years.
The pipeline will be capable of supplying fuel to Lothar at a rate of 273 kiloliters per hour. Approximately 3,200 kiloliters of fuel will remain in regular stock in the roughly 62-kilometer pipeline.
Land Leveling and Boundary Wall Construction Accelerated
According to Nepal Oil Corporation Deputy General Manager Rishiram Sharma, land leveling, construction of the boundary wall and other preparatory works required before the start of the main construction activities are progressing rapidly at the project site.
Once the land is prepared, Indian Oil Corporation will be responsible for constructing the storage facilities and other related infrastructure.
Motidan Construction has been awarded the contract for land leveling and construction of the boundary wall. According to company representative Krishna Ghorasaini, soil and other materials required for land filling are being collected and transported to the construction site.
The company started work in August–September 2026. A contract worth approximately Rs 790 million has been signed for the construction of the boundary wall and land filling. Although the contract period is one year, the company said construction has been accelerated with the target of completing the work within eight to nine months.
Fuel Storage Capacity of 91,900 Kiloliters
Once the project is completed, up to 20 million tonnes of petroleum products can be transported annually. A pipeline terminal will be constructed at Lothar on an area of 160 square meters.
Three vertical tanks, each with a capacity of 11,000 kiloliters, will be constructed for petrol storage. Three tanks with a capacity of 15,500 kiloliters each will be built for diesel storage, while two tanks with a capacity of 800 kiloliters each will be constructed for kerosene.
Similarly, three tanks with a capacity of 3,600 kiloliters each will be constructed for aviation fuel storage. The new storage facility at Lothar will have a total capacity to store 91,900 kiloliters of petroleum products. In addition, two blended-fuel tanks will also be constructed.
Aviation Fuel to Also Be Transported Through Pipeline
Once tanks for aviation fuel storage are constructed at Lothar, aviation fuel will also be transported through the pipeline.
At present, the corporation transports aviation fuel by tanker from Barauni, India. While aviation fuel currently has to be transported from a distance of around 400 kilometers, the corporation estimates that extending the pipeline to Lothar will save approximately Rs 5 per liter in transportation costs.
After aviation fuel begins to be transported through the pipeline, annual transportation costs are estimated to fall by around Rs 2 billion.
The corporation said transporting petroleum products through pipelines will minimize environmental impacts and eliminate the possibility of theft and adulteration. The total estimated cost of constructing the pipeline and storage facility is Rs 14.096 billion.
Project Advances Under Agreement With India
During then-Prime Minister Pushpa Kamal Dahal ‘Prachanda’s’ visit to India in May–June 2023, an understanding was reached with his Indian counterpart to construct the Amlekhgunj–Lothar petroleum pipeline and a modern fuel depot, including a storage facility, at Lothar.
The understanding stated that government-owned petroleum companies of both countries would enter into a mutual agreement and proceed with the construction. Accordingly, Indian Oil Corporation and Nepal Oil Corporation signed an agreement on October 3, 2024.
Under the agreement, the project is targeted to be brought into operation within 54 months of the start of construction. Indian Oil Corporation has also prepared the project’s Detailed Study Report.
Amlekhgunj Pipeline Meets 70% of Demand
The 69-kilometer cross-border petroleum pipeline from Motihari, India, to Amlekhgunj in Bara has been in operation since 2019. Then Prime Minister KP Sharma Oli and Indian Prime Minister Narendra Modi jointly inaugurated the pipeline on September 10, 2019.
Initially, diesel was imported through the pipeline. Petrol imports began on October 10, 2024, followed by kerosene imports from December 4, 2024.
The cross-border petroleum pipeline, the first of its kind in South Asia, has a total length of 69.2 kilometers, of which 33 kilometers lie in India and 36.2 kilometers in Nepal.
The pipeline was constructed to transport petrol, diesel and kerosene, and petroleum products imported through it currently meet around 70 percent of Nepal’s demand.
Petroleum products are supplied from Amlekhgunj to fuel storage facilities in Kathmandu, Biratnagar, Bhairahawa, Thankot, Pokhara, Birgunj and Janakpur.
Once the Amlekhgunj–Lothar project is completed, petroleum product supplies to western and northern parts of Nepal are expected to become more efficient and reliable.
Nepalpurbadhar