They raised a number of objections to the LPG policy during a meeting held here and told Petroleum Secretary Ahmed Waqar, who was in the chair, that the rules do not match the facts on ground. They, in particular, objected to 10,000 square meters areas required to set up an LPG station. Most of the participants were of the view that this condition was a big hurdle in promoting LPG culture on CNG pattern in Pakistan to provide the consumers a new channel to meet growing energy needs.
The LPG Policy - 2007, has been formulated by the Oil and Gas Regulatory Authority (Ogra) and the producers termed its rules as unrealistic and contradictory to the ground realities.
The LPG producers proposed that the government should make European market as model to allow setting up of LPG pumps at existing petroleum pumps. The LPG Policy bars from using the exiting petrol pumps premises for LPG sale. The LPG marketing at petrol pump is a new idea in Pakistan. Ogra started working on LPG policy in 2005, and after two years it was announced in 2006. It's effective from January 1, 2007.
As a part of the policy, LPG prices have been linked with contact price based on international rates. Ogra announces the new LPG prices at third day of each month for marketing companies.
The LPG price determination formula was another hot issue of the meeting. The producers do not want to follow declared policy for fixing up LPG prices on CP basis. They demanded that the petroleum ministry and Ogra should not regulate LPG prices and leave it to the open market demand and supply situation.
Sources said Ahmed Waqar gave patient hearing to the producers and told them that he would like to hear to the marketing companies before going for any final decision on LPG-related issues.
He is probably going to have a meeting with LPG marketing companies on policy issues sometime next week. Pakistan is deficit in LPG and it has to import huge quantity every month to meet local demand. Local production meets only a very small percentage of total consumption.