News

Double whammy for gas cylinders

  • New safety rules and forex crisis lead to cylinder shortage
  • Banks reluctant to open LCs for LPG imports: LAUGFS Chair
  • Says new regulations have cut down refilling by 80%
  • Confident supply can be increased in coming weeks
  • Litro to import new machinery to meet regulations, speed up supply

 

By Uwin Lugoda

The rollout of newly-introduced safety standards and the inability to open Letters of Credit (LCs) have resulted in Liquefied Petroleum Gas (LPG) supply shortages, The Sunday Morning learns.

LAUGFS (Pvt.) Ltd. Chairman W.K.H. Wegapitiya stated that there continued to be a shortage of LPG in the market due to these two main reasons. 

He explained that out of the two, the main reason was the inability to open LCs to import gas, a matter he claimed was beyond the company’s control.

Sri Lanka’s ongoing forex crisis has impacted multiple sectors involved in importing and exporting goods and services.

“We have been talking to all commercial banks, asking them to provide sufficient dollars and provide LCs, since it is affecting every sector,” said Wegapitiya.

He stated that the second reason for the shortage was due to LPG cylinder filling having slowed down as a result of the new safety standards that were being implemented. 

He explained that in order to ensure the highest level of safety, LAUGFS had to comply with the guidelines provided by the Sri Lanka Standards Institute (SLSI), Consumer Affairs Authority (CAA), and the Courts.

Due to this, Wegapitiya stated that the normal filling speed had slowed down, bringing their daily cylinder deployment into the market down from 40,000 to around 10,000-15,000.

“We are adhering to all the new guidelines, due to which our normal filling speed has slowed down, but we plan to bring it back to normal in the next two weeks. Our plants are working 24 hours a day to ensure that the filling speed picks up again and once it is fixed, we will go back to our old rate of supply,” he said.

Similar sentiments were shared by Litro Gas Lanka Ltd. Chairman Theshara Jayasinghe at a recent media briefing, where he stated that the new safety guidelines had slowed down the distribution process. He explained that as per regulations, the daily changing of cylinder valves had gone up from 300 to 3,000 and that the company planned on further increasing it to 20,000.

He stated that despite the purchase of LPG seeing a significant reduction in the last few months, the December season had brought back high demand. 

He added that despite the current situation, Litro was aiming to ease the shortage in three weeks.

In this regard, Jayasinghe stated that the company was working 24 hours a day to meet the demand, adding 40,000 standard cylinders a day to the market and importing the necessary machinery for their plants. He highlighted that in the past few days, the company had distributed 350,000 units to the market and planned on adding another 180,000 cylinders soon.

Meanwhile, the Colombo City Restaurants Collective (CCRC) had stated that its members were going through a tough time due to the LPG shortage in the country. Speaking to The Sunday Morning, CCRC President Harpo Gooneratne stated that restaurateurs were already faced a difficult 19 months due to Covid, eight of which they spent in lockdown, and were now facing a gas shortage.

“We don’t know when we are going to get our gas cylinders, so how can we function as restaurateurs? This has been a nightmare for us,” said Gooneratne.

He stated that the collective had already spoken to the Litro Chairman on this matter, who assured the sector would be extended as much aid as possible.