The Oil and Gas Regulatory Authority (OGRA) has initiated the process of third party audit of LPG sector in order to determine actual prices of LPG cylinders. The Ministry of Petroleum has directed OGRA to conduct third party audit both for the production cost of the producers and marketing/ distribution margins keeping in view relevant factors in order to rationalize the producer price and marketing and distribution margins for LPG prices.
According to a notification issued by Petroleum Division, Ministry of Energy, it is stated that the issue of exorbitant LPG prices is being repeatedly reported in media. Taking cognizance of the matter, the issue was discussed in detail in the ministry and it was agreed that an audit may be carried out to ascertain the LPG production cost of producers and LPG marketing and distribution margin, for setting the reasonable producer price and margins to address LPG pricing issue.
It stated that as all the LPG producers and marketing companies are licensee of OGRA and it is, therefore, requested that OGRA should conduct third party audit both for the production cost of the producers and marketing distribution margins keeping in view relevant factors in order to rationalize the producer price and marketing and distribution margins for LPG prices.
The LPG once used to be known as the poor persons' fuel is now available 20 times more costly than the natural gas price and to this effect the signature bonus collected by LPG producers has also emerged as main cause in the mammoth hike of product's price.
This has been stated in the official letter of Noor LPG Company Limited written on January 23, 2018 to OGRA, unfolding that there is no mention of signature bonus or premium in the LPG policy approved by Council of Common Interests (CCI) but public sector LPG producers are making illegal mammoth money in the name of unjustified signature bonuses.
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