Following a preliminary report by Chinese experts indicating a large reserve of natural gas in the Jaljale area of Dailekh, preparations have been intensified to finalize the findings.

According to the Department of Mines and Geology, the Chinese side is preparing to complete the final report by December. Before that, a discussion between Nepali and Chinese officials is scheduled to take place within this week.

The preliminary report of the petroleum exploration carried out in the Jaljale area of Dailekh, which revealed a large deposit of natural gas, has already been made public. A joint study conducted by Nepal’s Department of Mines and Geology and China’s Chengdu Center of the China Geological Survey has indicated that Jaljale contains approximately 112.1 billion cubic meters of natural gas.

After the preliminary report was made public, preparations began for discussions between the technical teams of Nepal and China to finalize the report.

According to Dinesh Kumar Napit, Director General of the Department, officials and experts from both countries are set to hold a meeting within this week. Representatives from the Ministry of Industry, Commerce and Supplies, as well as from the Department, are preparing to leave for China within a few days for the discussions. He stated that the Chinese side has informed that the final report will be submitted by December.

The first agreement between Nepal and China for conducting a petroleum exploration feasibility study was signed on March 23, 2016. Subsequently, on August 25, 2017, an agreement on cooperation for the Oil and Gas Resource Survey Project was signed, followed by an implementation agreement on February 28, 2019. According to the Department, the project was initiated for the period 2019 to 2025, and its term has since been extended for an additional three years.

This project, being implemented jointly by Nepal’s Department of Mines and Geology and the Chengdu Center of the China Geological Survey, is being carried out at a cost of around 136 million RMB (approximately 2.25 billion Nepali rupees). In June, the Chinese team submitted a preliminary report confirming the presence of a large reserve of natural gas in Jaljale, Bhairavi Rural Municipality–1 of Dailekh.

During the exploration, the deepest drilling ever conducted in Nepal - reaching 4,013 meters - was carried out. In that well (NDP-1), a total of 50 samples from nine different intervals and over 3,000 rock-cutting samples from various rock layers were collected and tested.

The preliminary results showed that the methane (CH4) content in those layers was over 90 percent. Since methane gas is more environmentally friendly and cheaper than LPG used for cooking, this resource is considered significant for Nepal’s long-term energy security.

According to the Department of Mines and Geology, about 650 million rupees will be required for gas production testing. It has been stated that the Chinese company has already begun necessary preparations for the test, and discussions are underway regarding the required technical and technological support.

According to Director General Napit, more than 2.25 billion rupees have already been spent on this project. He stated that once the finalization of the preliminary report is completed, the Department’s exploration work will come to an end. However, the Government of Nepal is preparing to conduct a separate study to determine whether commercial production will be feasible.

According to the Department, following the results obtained in Dailekh, plans have been made to conduct extensive petroleum exploration in Dang, Palpa, and Sunsari as well. Earlier, around 45 ropani of land in the Dailekh area had been acquired to advance the exploration work.

The Department has stated that the gas reserve found in Jaljale, Dailekh is even larger than the 75 billion cubic meters discovered in the Black Sea region of Turkey last May. Based on preliminary data, the discovery of such a large volume of natural gas in Nepal for the first time is being viewed as a historic opportunity for the country’s energy self-reliance.

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