Suitability of Storage as a Long-Term Solution to LPG Shortages

Directors and industry experts in Nepal have suggested constructing domestic gas storage infrastructure and other measures to provide a long-term solution to the recurrent shortages of LPG used for cooking. While Nepal Oil Corporation (NOC), which regulates the import and sale of fuel and gas, has storage capacity for petroleum products, there is currently no adequate infrastructure for storing LPG. Industry representatives note that existing storage facilities can hold only about 11,000 metric tons, sufficient for roughly five days of LPG supply.

Experts acknowledge that increasing storage capacity could introduce new challenges, but it would reduce the risk of LPG shortages in the market. Although NOC has already acquired land for gas storage, the expansion of electric stove usage has delayed the construction of the necessary storage infrastructure, according to officials. “Nepal Oil Corporation must maintain its own storage facilities,” said NOC Managing Director Nagendra Sah. “Currently, 58 private LPG brands operate under various policies, and the lack of unified storage has created problems.”

Officials speculate that some industries have refrained from establishing adequate storage due to concerns over possible price reductions as the Iran nuclear deal approaches. “Even if the Corporation had storage for 15 to 10 days, it could intervene in the market. Currently, the reality is that there is no LPG storage at all,” Managing Director Sah stated. Private LPG entrepreneurs also emphasize the need to develop storage infrastructure. Former President of the Gas Industry Association, Shivprasad Ghimire, stated, “Whether by NOC or the private sector, it is essential to maintain at least one to two months of LPG storage within the country.”