Nepal Oil Corporation moves to merge 58 LPG brands and proposes 30% commercial quota
The state fuel company wants fewer cylinder brands and a commercial-rate slice of each industry's monthly quota. The industry has one week to give its position.
Nepal has 58 liquefied petroleum gas industries, each filling cylinders under its own brand. On 29 October 2026 the Nepal Oil Corporation (NOC) wrote to every one of them asking them to start merging.
The NOC, the state-owned importer and distributor of petroleum products, has begun a process to consolidate the industries. At a meeting with the industry association it also proposed that each industry buy 30% of its monthly quota at commercial rates and sell that gas only for commercial use. The association has one week to reply.
A letter, and a policy point
The corporation says the merger drive follows Point 32 of its approved policy and programme for the fiscal year 2083/84 in the Nepali calendar, which corresponds roughly to 2026/27. Its letters urged the industries to encourage mergers, prepare action plans and move forward. NOC Director Binit Mani Upadhyay has said the aim is to simplify sale and distribution and protect consumers.
The corporation expects a consolidated system to be more organised, convenient and consumer-friendly.
Source: Nepal Oil Corporation proposals
No merger partners, timetable or terms have been named in the sources. The corporation has asked the industries to draw up their own plans, which leaves the bargaining to them.
The 30% proposal
The quota idea was presented at a meeting between the corporation and the Nepal LPG Industry Association. The NOC was represented by board member Namaraj Ghimire and Executive Director Nagendra Shah, and the association by its president, Diwan Chand, and other office-bearers.
Under the proposal, until cylinders of different capacities designed specifically for commercial use reach the market, each industry would collect 30% of its quota directly from the corporation at commercial prices. It would then sell that gas only for business purposes, either by ensuring end use or by assigning specific brands to commercial sales.
The meeting also discussed mergers to cut operating costs and streamline the market, and a single logo for cylinders sold across the country. The sources do not say how large the price gap between household and commercial gas is, or how much gas is diverted.
Who gains, who loses
The analysis below is reasoned from the proposals as reported.
The corporation would deal with fewer industries if mergers go ahead, and a fixed commercial slice would show it how much gas goes to business users.
Household consumers could benefit if fewer brands and a single logo make cylinders easier to recognise. Any gain would depend on enforcement, which the sources do not describe.
Industries with larger operations may be better placed to absorb others, while smaller brands may have to choose between merging and standing alone. The sources do not identify which firms are large or small.
For the industries, buying a slice at commercial prices raises the cost of that gas, but selling it only to business users could bring a better price. Brand-specific commercial sales could also require firms to separate their product lines, which would add cost.
Why it matters beyond the cylinder
If the proposals go ahead, the NOC would be shaping the bottling market through its quotas and its merger policy. For investors in Nepal's energy and consumer sectors, the terms of any quota and consolidation will matter as much as competition between brands.
The industry representatives chose to hold internal discussions before giving the corporation their position.
What to watch
The association's reply to the 30% proposal, due within a week of the meeting. Whether the corporation sets a deadline for merger plans following its 29 October 2026 letters. Which brands put forward merger plans. Whether commercial-use cylinders of different capacities are introduced, since the quota is meant to apply until they arrive. And whether the single-logo idea moves from discussion to rule.
How this story was made: researched and written by The Standard’s desk with AI assistance, from the published reporting and official data credited below, and checked against those sources. Our standards.
