Eight producers seem reluctant to scale down LPG prices

Eight producers of Liquefied Petroleum Gas did not pay any heed to the decision of the government to revise and de-link the LPG prices from the international market.
LPG Distribution Association Chairman Muhammad Irfan Khokhar told a news conference, here on Wednesday that in Pakistan, nine companies are producing LPG to meet the domestic needs. Their contribution in the production is 94 percent and only 6 percent is imported.
Khokhar said the Prime Minister taking notice of the rising prices of LPG, announced to de-link its prices on November 30, 2007, with a directive to implement prices of 2006 that stood at Rs 25,000 per ton at that time. Only Jamshoro Joint Venture Limited (JJVL) reduced prices. Since 2006 the LPG producers earned Rs 3.11 billion by increasing the prices, he maintained.
The other eight producers that include Oil and Gas Development Company, Pakistan Petroleum Limited, Pakistan Oil Field Limited, Orient Pvt. Limited, Pak Arab Refinery Limited, Pakistan Refinery Limited, National Refinery Limited and Attock Refinery Limited are not following the government decision.
He said during last five years (2002-2007), local production of LPG increased 100 percent from 950 tons to 1850 tons. But the prices kept on rising and reached Rs 52,151 per ton from Rs 12,510 during this period, showing an increase of 131 percent.
He said Oil and Gas Regulatory Authority (Ogra) has issued licences to five LPG cylinder manufacturers and established a task force for crackdown against fake producers. In Gujranwala, almost 300 units are producing substandard cylinders without any licence, which killed more than 700 people in 2006. The task force will start operation from December 27, 2007 to curb the production of poor quality cylinders, he added.
He said Ogra should establish a committee to monitor producers, distributors and marketing companies to end the exploitation of poor consumers. Khokhar called for a specific formula for determining LPG prices and making it part of the petroleum policy.