LP gas still in short supply despite rise in supply quota

30 Jan 2015, Kathmandu : Liquified petroleum (LP) gas is in short supply even though the Nepal Oil Corporation (NOC) has increased supply quota to bottlers for January to 29,000 tons.

NOC had raised supply quota by 4,000 tons 10 days ago to improve availability of the popular cooking fuel in the market. The state-owned petroleum monopolist had earlier increased supply quota by 3,000 tons. Until December, NOC was supplying 20,000 tons to bottlers every month. 


Though supply quota for January has been raised to 29,000 tons, bottlers have imported only 22,000 tons so far. With just two days remaining in January, it is unlikely that bottlers will be able to import the supply quota assigned to them.

NOC Spokesperson Mukunda Ghimire told Republica that bottlers could not import LP gas as per the quota allocated to them as Barauni refinery of Indian Oil Corporation (IOC), which underwent regular maintenance works in December, could not supply as per the order placed by the bottlers. He also said bottlers will be allowed to import 29,000 tons in February as well.

LP gas bottlers imported only 18,886 tons in December which is lower by about 1,000 tons compared to figures of January, 2013. The figures clearly shows LP gas supply in the market has been on decline since that month.

"LP gas supply was slightly lower in the past two or three months. With the increment in quota, we expect the supply to be normal in the next 10 days," Ghimire told an interaction in Kathmandu on Thursday. He blamed media for spreading panic among consumers.

Similarly, Shiva Ghimire, president of Nepal LP Gas Industries Association, said they could not meet the increased quota as NOC´s formal request to IOC came rather late. 

Government officials, LP gas bottlers and dealers said LP gas shortage was due to ´panicked hoarding´ by consumers.



Workers unload filled liquified petroleum (LP) gas cylinders at a distribution point in Baneshwar on Thursday.(Bijay Rai/Republica)

LP gas is in short supply for the past two months due to demand/supply mismatch, artificial shortage created by bottlers to circulate new cylinders in the market, and the absence of effective monitoring by the Department of Commerce and Supply Management. 

The government had tried to supply LP gas to consumers though the Teku-based office of National Trading Limited (NTL). But it couldn´t be successful after LP gas bottlers and dealers refused to supply cylinders at the office. The government´s mobile distribution system is also becoming ineffective in the lack of support from LPG bottlers and dealers.

Grihalaxmi, Subidha not supplying in Kathmandu Valley

Consumers of Grihalaxmi and Subidha gas in the capital have not been able to refill their cylinders for the past five or six months. 

Pokhara-based Grihalaxmi Gas Udyog has stopped its supply in the capital without giving any information to consumers. Similarly, Biratnagar-based Subidha Gas Udyog also has not supplied LP gas to capital in recent months. Both the companies have around 10,000 consumers each in the capital.

Hari Narayan Belbase, director of DoCSM, many consumers and dealers have empty cylinders of Grihalaxmi and Subidha. Belbase, who was in Pokhara last week to study LP gas supply situation, said officials of Grihalaxmi told him that transportation of LP gas to capital would cost them an additional Rs 67 per cylinder.

"I´ve directed them to withdraw cylinders from the market if they are not in a position to make supply," Belbase said.

DoCSM has yet to inspect Subidha Gas Udyog. 

Ghimire of Nepal LP Gas Industries Association, said bottlers should withdraw cylinders by returning deposits of consumers if they cannot make supply. "I´ve learnt that Grihalaxmi supplied around 100 cylinders in the capital on Thursday," he added.

Consumers have to pay Rs 2,330 to buy empty cylinder. They can get the cylinders refilled at Rs 1,470.

Consumers blame gas bottlers and dealers focus on circulation of new cylinders in the market during shortages to make some fast bucks. Dealers get only Rs 25 per cylinder as commission. - See more at: http://myrepublica.com/portal/index.php?action=news_details&news_id=91240#sthash.boSzji1u.dpuf