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No plans for state-owned LPG company 

03 Jan 2022

  • ‘No bar to private company,’ says top Consumer Protection State Ministry official 
BY Pamodi Waravita  Responding to a State Minister’s assertion that a state-owned liquefied petroleum gas (LPG) company should be launched in order to avoid the supply issues that have arisen due to the LPG duopoly that is currently present in the market, well-placed sources told The Morning that the Government has no plans at present to launch a state-owned LPG company. However, the high-ranking official of the Co-operative Services, Marketing Development, and Consumer Protection State Ministry said yesterday (3) that while there is no barrier to any new LPG company that seeks to enter the market for the import and distribution of LPG, “there is no issue for any private player who wants to enter the Sri Lankan LPG market if they wish to do so. However, the State Ministry has no plans at the moment to facilitate another state-owned company”. These comments were made following Vehicle Regulation, Bus Transport Services and Train Compartments, and Motor Car Industry State Minister Dilum Amunugama’s recommendation last week that the Government should facilitate more LPG companies in the market. “A government company is needed to import LPG. The distribution is a different matter. The current problem in supply delays is due to some business problems and interests. The Government is aware of this and those steps will be taken properly through the Trade Ministry this year. When two companies have a duopoly in the market, these kinds of problems are created. We should have let four or five other companies enter this industry and that would have prevented these present issues,” Amunugama told the media on 31 December 2021. State-owned Litro Gas Lanka Ltd. accounts for about 80% of the market, whilst the private player, Laugfs Gas PLC, owns the remainder. Both the companies have been experiencing severe supply delays over the past two months, compounded by the LPG cylinder-related explosions that reached its peak in the months of November and December 2021. With new safety regulations in place to prevent this issue, Litro Gas Lanka Chairman Theshara Jayasinghe told the media over the weekend that the company is finding it time consuming to meet the safety standards and that it may take about three weeks for the supply to be restored to normal. Laugfs Gas Chairman W.K.H. Wegapitiya slammed the Government over the weekend, claiming that the inability to open letters of credit (LCs) has led to the company being unable to meet the consumer demand. The media reported yesterday that many restaurants and eateries have temporarily closed down as they are unable to carry out their services without a steady supply of LPG whilst queues of consumers outside LPG outlets were a common sight yesterday, as it has been for several days. Co-operative Services, Marketing Development, and Consumer Protection State Minister Lasantha Alagiyawanna stressed last month that the Government would not hesitate to even close down the two companies if they continue to act irresponsibly, without regard for consumer safety, following the Presidential Expert Committee appointed to investigate the recent LPG-related explosions noting that the increase in the propane ratio led to the recent explosions.

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