The open auction of LPG quota will benefit a few big companies, promote cartel and push up prices of liquefied petroleum gas (LPG) in the country. This was stated by the chief executive officer (CEO) of Power Gas, Muhammad Ali Haider here Tuesday.
He said that LPG quota auction will increase the prices of LPG by Rs 4,000 to 7,500 per metric ton on account of payment under signature bonus (a kind of premium). Haider, who is representing small LPG marketing companies, said that the auction will increase government revenue, but at the cost of 10 million poor LPG users in the remote areas of Sindh and Balochistan.
A few companies will be able to buy LPG quota under auction and they will further strengthen their cartel. He alleged that OGDC has earned Rs 560 million from the auction through its Bobi and Kunnar fields, but at the cost of the poor consumers. Haider urged the government to withdraw its decision for the auction of LPG which is included in the list of sensitive items and a basic necessity in those areas where piped gas is not available.
He pointed out that LPG producers were earning huge profit as they are selling LPG at international prices. Their cost of production is less than Rs 10,000 per metric ton but they are charging Saudi Aramco Contract Price (CP), he added. He said that the profiteers were taking advantage of 400 to 500 tons per day LPG shortage and making huge money.-PR
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