NOC not to supply LPG to new plants

KATHMANDU, MAR 11 -

The Nepal Oil Corporation (NOC) has decided not to supply Liquefied Petroleum Gas (LPG) to upcoming bottling companies, which have received the corporation’s agreement in principle for gas supply, but have not completed installing their plants.

This will affect around 20 new bottlers, to which the oil monopoly had agreed in principle to supply gas after their plants get ready.

An NOC board meeting on Saturday took such a decision so as to ‘better manage and supervise gas distribution amid artificial shortage’. “The current gas shortage has proved that increasing the number of gas plants would not make a difference if black-marketing persists,” said NOC Spokesperson Mukunda Dhungel.

Over the last three years, around two dozen new bottlers have received NOC’s agreement in principle for gas supply, but most of them are yet to complete setting up their plants, according to Dhungel. “Only three-four plants that have reported about the completion of their plants will be supplied with LPG.”

Currently, 42 gas plants supply LPG to the market. “We don’t need additional plants. The current number is adequate,” said NOC’s Acting Managing Director Suresh Kumar Agrawal.

Although NOC says it has already supplied LPG more than the market requirement, the market is still witnessing a shortage. NOC said it supplied over 17,529 tonnes in February, although the country’s projected average LPG demand stands at 14,410 tonnes for 2012. “Based on the supply, the shortage should have already ended,” said Agrawal.

With black marketers creating artificial shortage, the Prime Minister’s Office has also told the authorities concerned to initiate action against LPG hoarders under the Black-marketing Act.

Alarmed by the LPG shortage that has been persistent for over a month now, the government recently sealed Himal Gas plant for its involvement in black-marketing. NOC also plans to introduce LPG customer cards to regulate the current gas distribution channel. Introducing the system, NOC seeks to supply LPG to industrial users at the cost price and to household consumers at a subsidized rate.

Source: Kantipur