Government, LPG stakeholders’ meeting ends in deadlock

Industry rejects price, demands weighted average of local, imported gas be used to set rate

ISLAMABAD: The government and LPG industry failed to reach a consensus on fixing the price of the commodity after authorities said that the rate should be Rs895 per cylinder that has a capacity of 11.8 kilogrammes.

In response, LPG companies and distributors declined the government’s proposal, terming it as not reasonable.

“The proposed price is not feasible for LPG imports,” said LPG dealers association, demanding that the price should be determined by using weighted average of locally produced and imported gas.



This was discussed in a meeting between the Petroleum Division and LPG distribution and marketing companies, which remained inconclusive.

After the meeting, LPG Distribution Association Chairman Irfan Khokhar told the media that the proposed consumer price by the federal government was unrealistic as current price of domestic cylinder ranged from Rs1,200 to Rs1,400 depending on regions.

He said that LPG stakeholders suggested that the price of LPG should be based on weighted average of locally produced and import price of LPG. He further said that the government proposed a profit of Rs24,000 per ton for LPG distribution and marketing companies. However, LPG marketing companies sought Rs29,000 per ton, which included margins of LPG distributors.



Khokhar suggested separate profit for dealers at 15% on sale price of LPG.

He said that imports should be made feasible for smooth supply of LPG to avoid the demand supply issue.

Published in The Express Tribune, September 29^th, 2017.

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