Nepal Oil Corporation Halts Fuel Supply to Airlines

Nepal oil corporation halts fuel supply to airlines

KATHMANDU, Nov. 18 (Xinhua) — The cash-strapped Nepal Oil Corporation (NOC) has stopped supplying aviation fuel to three domestic airlines in response to their failure in clearing outstanding oil dues.

As a result, Gorkha Airlines, Cosmic Air and Heli Hansa Airline saw severe disruptions in their Friday’s scheduled flights.

But NOC maintained fuel supply to Cosmic Air’s international flights on condition of immediate payment.

According to an official from NOC, Cosmic Air owes dues amounting to 85 million Nepali rupees (1.21 million US dollars), while Gorkha Airlines has 6 million rupees (85,714 dollars) and Heli Hansa has 1.7 million rupees (24,285 dollars) to pay to NOC for supplies made in the past.

Under the existing payment arrangement, airlines are required to make payment of the fuel to NOC within 15 days of supply.

Earlier, the NOC had fixed 30 days as the payment period, but reduced it to 15 days after it stared facing a severe financial crunch itself.

“All three airlines did not make payment within the time, despite repeated requests,” said the official on condition of anonymity, adding that the corporation will continue its embargo till they settle previous dues.