Petroleum Officials and Dealers in Bribery-for-Commission Case?

A diesel tanker parked at the Police Kalyan Petrol Pump in Naxal, Kathmandu, earlier this evening. Outside, vehicle owners wait for petrol even as the station's staff announce they have run out of it. Photo: Kashish Das Shrestha

A diesel tanker parked at the Police Kalyan Petrol Pump in Naxal, Kathmandu, earlier this evening. Outside, vehicle owners wait for petrol even as the station’s staff announce they have run out of it. All Photo: Kashish Das Shrestha

Its just about 7PM and there are over a 100 vehicles waiting for petrol outside the Police Kalyan Petrol Pump in Naxal. The pump’s managers, with the help of police and traffic officers, are trying to convince everyone to go home. The station had run out of petrol. “I haven’t been waiting long,” one motorcyclist told me. “I have only been here for a little more than an hour.”

This is how normal a fuel crisis has become to us.

On any given day, the pump sells about 12,000 to 15,0000 liters of petrol. Their tank can hold about 21,000 liters. Today, the pump received only 8,000 liters of petrol. By 7PM they had sold a little over 10,000 liters of petrol – everything they had. The pump keeps about 4,000 to 5,000 liters of diesel in reserve at all times in case the Police needs it for emergency. “All the police vans run on diesel,” a staff explained.

Eventually, by 7:15PM the scooters and motorcycles went home, but a line of cars remained parked outside the gas station, hoping to not lose their spot in line whenever supplies resume.

A traffic officer asks people waiting for petrol to leave and clear up the road as the station had already run out of the stuff. This motorcyclist had been waiting for over an hour.

A traffic officer asks people waiting for petrol to leave and clear up the road as the station had already run out of the stuff. This motorcyclist had been waiting for over an hour.

So what is fueling this crisis right now? Here’s is a part of it. Officials at Nepal Oil Corporation and members of Nepal Petroleum Dealers’ National Association are currently having to deal with some serious accusations of bribery and corruption. As the Kathmandu Post reported:

“The association had collected more than Rs 8 million from about 2,300 petrol pumps for ‘bribing’ in the name of organising a strike or settling the issue of commission hike. Subsequently, the NOC board hiked the commission by 56 paisa on a litre of petrol , 39 paisa on diesel and 44 paisa on kerosene.

But when the association’s move to collect money for the purpose of bribing came to light, the NOC board suspended the decision to hike commission and formed an inquiry committee.

Organising strike in the petroleum sector is illegal as per the Essential Service Act which has a provision of sentencing those involved upto six months in prison.”

Should the bribery charges be true, surely that calls for jail time too.

Initially these vehicle owners refused to leave even as the station announced it had run out of petrol. By 7:15PM most of the two-wheelers had left while the 4-wheelers were parked for the night.

Initially these vehicle owners refused to leave even as the station announced it had run out of petrol. By 7:15PM most of the two-wheelers had left while the 4-wheelers were parked for the night.

In The Himalayan Times coverage  of this issue, its news report noted these worrying facts:

“NOC has been suffering huge losses since 2007, as it couldn’t hike prices by a desired amount due to political interference in the pricing mechanism. It owes around Rs 20 billion in debt to financial institutions.

The state-owned oil monopoly decreased its storage capacity from 14-15 days to six-seven days following a financial crisis two years ago.”

Nepal Oil Corporation was granted a Rs.2 billion bail out just last week.

Security keeps an eye over the anxious crowd of vehicle owners who have been told they won't be getting any petrol today. It is not clear when normal supplies might resume.

Security keeps an eye over the anxious crowd of vehicle owners who have been told they won’t be getting any petrol today. It is not clear when normal supplies might resume.

My Op-ed this morning,Drowning in Diesel, was directed specifically on the need to reduce diesel use for generating electricity, this episode is a stark reminder of the many problems Nepal Oil Corporations is embroiled in and that increasing Nepal’s dependency on fossil fuel just doesn’t make sense for a variety of reasons.

So when will this particular artificial fuel crisis end? “We hear the negations between NOC and the Association has not ended today, so the shortage will continue tomorrow for sure,” staff at Kalyan Petrol Pump explained.

 

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