Kathmandu, November 4
Nepal Oil Corporation’s Enterprise Resource Planning (ERP) project, launched to integrate all its operations into a unified digital system, has reached its final stage.
According to an assessment conducted by Kathmandu University’s University Consult, an independent consultant, around 88 per cent of the project’s functional requirements have been fulfilled. The corporation said the project is now in the completion and handover phase.
With annual transactions worth around Rs 300 billion, the corporation is moving towards fully paperless and transparent operations.
More than 1,500 dealers, 60 bottlers and 43 airlines and agents across the country can now order fuel online without physically visiting depots, make digital payments and access their transaction records.
The system integrates the corporation’s sales, distribution, finance, accounting, procurement, storage and human resource operations into a single software platform, eliminating duplication and facilitating faster decision-making. More than 500 employees, thousands of dealers and around 1,900 tankers are connected to the system.
Before the ERP system was introduced, the corporation’s operations relied entirely on paperwork and physical presence. According to ERP Project Chief Pradeep Kumar Yadav, the previous manual system involved considerable risks.
“Previously, dealers had to deposit money at banks and carry payment vouchers to depots. There was a risk of losing the vouchers, meeting with an accident or being robbed on the way,” Yadav said. “With the implementation of ERP, the practice of carrying vouchers and the possibility of counterfeit vouchers have come to an end.”
Following the integration of the corporation’s system with Nepal Clearing House, payments made through connectIPS are automatically updated in the ERP system.
The ERP system is based on SAP Business One, developed by German software company SAP. Built on the SAP HANA database, the system operates through an internal Linux-based intranet rather than the public internet.
The corporation signed an agreement with Neoteric Neo Software JV, selected through a public procurement process, on July 19, 2020. The contract stipulated 12 months for system development and 24 months for implementation and maintenance, making the total project duration 36 months. However, due to the Covid-19 pandemic and testing requirements, the project has taken nearly six years to reach completion.
“Although we extended the project deadline, we did not increase its cost. We extended the testing period to avoid major financial losses that could result from rushing the implementation of software in an organisation handling annual transactions worth Rs 300 billion. We proceeded only after repeated tests to ensure that no errors remained,” Yadav said.
The project cost Rs 228,714,169, excluding value-added tax (VAT). Of this amount, Rs 125,108,513, or 54.87 per cent, has been paid so far. The remaining payment will be released only after fulfilling the contractual conditions and obtaining final approval for the project.
Real-time transactions with IOC and fully online external payments
Payments received by the corporation have been fully digitised, while system integration with the Indian Oil Corporation (IOC) is in the final stages of development and testing.
Following final approval from IOC’s Mumbai office, the corporation will be able to send automated purchase orders, generate automated tanker indents and receive invoices in its system in real time.
The payment system for suppliers, transporters and employees has also been developed. “Contractors and transporters will no longer have to visit the office to collect cheques for external payments. Once approved by the board of directors, all external payments will be transferred directly to the respective bank accounts online,” Yadav said.
The corporation has also introduced online systems for e-recruitment, e-delivery of fuel to aircraft at all airports in Nepal, and management of employee leave and travel.
Plans for own data centre and AI integration
After the project handover, the corporation plans to invite open competitive bids to ensure the system’s continued operation and develop additional features.
In the future, the corporation aims to integrate the ERP system with the Internet of Things (IoT) and artificial intelligence (AI) to make fuel supply safer and more transparent.
As part of this plan, the corporation has already begun the bidding process to establish its own data centre at its central office in Babarmahal. It expects the centre to become operational by Baishak 2084 BS. The corporation also plans to connect all its automated depots to the ERP system.
