The Oil and Gas Regulatory Authority (Ogra) clarified on Wednesday that the incumbent Member Gas advised streamlining the regulatory framework to pave the way for bringing all LPG bowers into regulatory network.
According to the Ogra, although Ogra ordinance have been in force and effect since year 2002 which required regulation of midstream and downstream sectors, Ogra first time took the cognizance of license of LPG transportation activity in the year 2011-12 i.e. over nine years ago.
However due to cumbersome and costly licensing procedure and that too for individual LPG bowser, only three LPG bowers could be granted license. The non-cooperation and lack of response from the LPG Marketing Companies and private LPG bowers speak volumes about how difficult it was for the LPG bowser owners to seeking licenses for each individual bowser, even when Ogra reduced the license fee from Rs 100,000 to Rs 25,000 per bowser.
The incumbent Member Gas, who is a qualified professional and has long extensive experience of oil and gas industry, reviewed the long outstanding LPG bowser licensing matter and identified loopholes in the lengthy procedure and mechanism for individual licensing of LPG bowzers by Ogra. It may be borne in mind that three tier certification and licensing mechanism of each LPG bower is already in place. LPG Bower Manufacturers in Pakistan are already certified by Ogra. Once LPG Bower is manufactured, it is subject to the license from the Chief Inspector of Explosives (CIE) and also relevant Road Transport Authority (TPA). After all the three-tier certification from different statutory departments in place, existing procedure also requires a certification from an independent third party appointed by Ogra.
The incumbent Member Gas advised streamlining the regulatory framework to pave the way for bringing all LPG bowers into regulatory network, in total disregard thereof, LPG Department issued directions to the industry to get the bowsers licensed within 15 days after which companies may not be able to uplift/transport/decant LPG within the country, which may seemingly cause damage to the country by bring the entire LPG logistics and supply operations to a standstill in severe weather condition when the demand for LPG was already at its peak and supply too short. This would have caused strikes, riots and road blockages throughout the country. The matter is being investigated by the Authority to fix responsibility on the responsible officials.
Initially Ogra fixed a license fee for each bowser at Rs 100,000 which was reduced by the Authority to Rs 25,000 in its meeting held on 7th August 2019. License fee is only once in license term of each bowser, which shall be obtained by Ogra upon bringing all the LPG bowsers into licensing regime which is planned to be done within a month. Notwithstanding no loss of any sort has occurred to the national exchequer.
It may be pertinent to mention that similar to the LPG bowsers, thousands of oil tankers are operating in Pakistan, regulation of which also fall within the mandate of Ogra. In the recent past, when Ogra only asked all such oil tankers to obtain CIE and RTA certification, the oil tankers association went on a country-wide strike in 2017 and since then they are operating unguarded. Similar strikes and supply chain shutdown were anticipated which were ably averted by timely action by the incumbent Member Gas in the best national interest.-PR
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