The sub-committee of the National Assembly on Wednesday expressed serious concern over deregulation policy of Liquefied Petroleum Gas price, which is resulting in manipulation by LPG producers to mint money. The sub committee which met with Member National Assembly Barjees Tahir in chair noted that prices of all other products including Compressed Natural Gas (CNG) and petroleum products were being regulated to stabilise prices in the market.
Oil and Gas Regulatory Authority (Ogra) official Sarmad Aslam said there was no third option except de-regulated and regulated LPG price mechanism. "Why the government has adopted policy to follow de-regulated price mechanism for LPG," Barjees Tahir questioned. But the Ministry of Petroleum officials failed to respond to the logic behind this policy. Additional Secretary Petroleum Ministry Ijaz Chaudhry proposed to hold a meeting with independent experts to review existing LPG pricing mechanism.
He said the government was following uniform LPG pricing policy. "Local production is not enough to meet the domestic requirements and local producers will manipulate the market for their benefit if maximum cap on LPG price is removed," he said, adding that it will hurt importers.
The sub committee also grilled LPG marketing companies which have failed to control their distributors to sell LPG at announced rates. The NA sub-committee was informed that LPG price for October 2010 was Rs 663 per domestic cylinder and Oil and Gas Regulatory Authority (Ogra) had set reasonable price at Rs 1030 per domestic cylinder, which raised serious concern among the committee members.
Meanwhile, LPG Association Pakistan (LPGAP) spokesman proposed that the government should issue licenses to distributors through Ogra, so that penalties could be imposed on them rather LPG marketing companies in case of violation. But Ogra official Sarmad Aslam said distributors were authorised by LPG marketing companies, therefore, these companies were responsible for manipulating distributors.