The open auction of LPG quota will benefit few big companies, promote cartels 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 on Tuesday. He said that LPG quota auction would 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 the auction will increase government revenue but would cost 60 million poor LPG users in the remote areas of Sindh and Balochistan. He said only few companies would be able to buy LPG quota under auction and they would further strengthen their cartel.
Haider urged the government to withdraw the decision for auction of LPG, which was included in the list of sensitive items and a basic necessity in those areas where piped gas was not available. He pointed out that LPG producers were earning huge profit by selling LPG at international prices. Their cost of production was less than Rs 10,000 per metric ton but they were selling it at 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 big money.
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