LPG imports arrive ahead of Ramazan

‘Additional import of 2,500 tons to keep prices stable’.

ISLAMABAD:

Jamshoro Joint Venture Limited (JJVL), one of the country’s top LPG producers, has imported 2,500 tons of Liquefied Petroleum Gas (LPG) ahead of increasing demand in Ramazan.

This additional availability of LPG will assist in maintaining retail prices at affordable levels across the country, said a company spokesperson.

MT Gas Sulawesi berthed at Engro Vopak terminal in Karachi on Thursday and now the fuel is being transported nationwide, the spokesman said JJVL shall be importing more fuel during Ramazan as well.

LPG imports stood at 9,307 tons during the second half of the financial year 2011 against massive imports of 50,836 tons in the first half, according to official data. LPG marketing companies often sustain losses during summers because of the low demand, however, demand picks up during Ramazan, irrespective of season.

LPG producers sell fuel to Oil and Gas Regulatory Authority (Ogra) licensed LPG marketing companies, which then market the gas through their authorised LPG distributors. Currently, LPG retail price is Rs120 per kg in Lahore despite a recent Ogra directive fixing the maximum retail price at Rs105 per kg.

LPG marketing companies say that they are providing LPG to their distributors at the Ogra-mandated price of Rs99 per kg. The LPG distributor, who represents the lowest investment in the value chain, is currently enjoying a windfall net margin of Rs18 per kg or Rs18,000 per ton. The JJVL spokesperson said that the company deals only with LPG marketing companies and not distributors. The monthly price is set in accordance with the LPG policy, on the basis of Saudi Arabian export prices, spokesperson added.



Published in The Express Tribune, July 29^th, 2011.