Nepal has made zero progress in exploring petroleum in the past three years. The task of exploring and extracting petro­leum products was given to a Chinese govern­ment-owned company in the wake of the acute shortage caused by the five-month-long block­ade imposed by India in 2015-16. KP Sharma Oli, the current and the then prime minister, had even signed an agreement with the Chinese government to that effect in early 2016. Immediately following the agreement, Nepali officials and technical experts from the Chinese company had conducted a field study of some half-dozen districts with petroleum potential. But even two years after the preliminary study, the exploration works remain stuck—largely due to official indifference.

 

It’s as if the government, which expressed strong interest in petroleum survey during the blockade, forgot about it once the shortage eased. This despite the fact that the China has pledged aid worth Rs 2.5 billion, as well as tech­nical assistance, for petroleum exploration.

 

What’re the chances?

 

Sudhir Rajaure, chief of the petroleum exploration promotion project at the Department of Mines and Geology, claims that the preliminary study was not particularly fruitful. “We had submitted detailed data on potential petroleum sites to the Chinese team. Based on our data, they had carried out field research. But the project could not move ahead as the Chinese team gave us no further infor­mation. We repeatedly wrote to the Ministry of Foreign Affairs to make inquiries with the Chinese company, but we didn’t hear from them,” says Rajaure.

 

He informed that there are 10 potential regions in Nepal—mostly in the Madhes, inner Madhes and the Chure range—for petroleum extraction. Similar regions in Assam (India) and Potwar (Pakistan) have been producing petroleum for a long time.

 

“The first task is to identify the quantity and quality of petroleum at a particular site. The whole process—from preliminary study to extraction—takes at least three years. To ascer­tain the presence of petroleum in a particular site, some drilling is necessary,” says Rajaure.

 

In the late 1980s, the Department of Mines and Geology had drilled some 3,500m at a site in the south-eastern district of Morang. But no remnants of petroleum deposits were found. Rajaure thinks that the drilling has to go up to 4,000m deep in order to strike oil.

 

Extremely risky investment

 

But if no oil is found, it will mean a loss of billions. The work is inordinately costly as it requires sophisticated technology and high­ly-skilled technicians. So the government has reason to be hesitant about investing in petro­leum exploration. And without ‘reasonable certainty’ that Nepal has oil, renowned global oil-exploration companies won’t be attracted here, opines Rajaure.

 

In Kathmandu, the extraction of methane hasn’t been effective either. It has been found that 14 sites east of Teku have methane under­neath them. A preliminary study was also con­ducted in Imadol last year.

 

By Pawan Timilsina | Kathmandu