Daily Times

Karachi: The distributors of Liquefied Petroleum Gas LPG have sought the government’s intervention to get them rid of what they call ‘signature bonus’ and ‘premium’ being unjustly charged by the LPG producers, both private and public.

The distributors have termed these charges as ‘extortion’ and a causative factor in the LPG prices hike. “If this unjust ‘signature bonus’ and ‘premium’ is eliminated the price of LPG will instantly drop by around Rs 8,000 per ton”, claims Ali Haider, Vice Chairman of All Pakistan LPG Distributors’ Association who is also vice Chairman of FPCCI’s Standing Committee for LPG.

Pakistan’s petroleum regulator, Oil and Gas Regulatory Authority OGRA has recently notified Rs 76,500 per ton for LPG consumer prices which means the consumers will be charged Rs 900 for 11.8 kg cylinder but the actual price of LPG hovers around Rs 100,000 per ton or Rs 100 per kilogram. “Despite being aware of the existence of ‘signature bonus’ and ‘premium’ OGRA has not directed the producers to stop charging millions of rupees from marketing companies which makes the situation worse”, Haider lamented.

Haider claims that the actual cost of LPG production does not exceed Rs 30,000 per ton but producers are charging higher prices by unfairly linking it with Saudi Aramco Contract Price which stays close of Rs 60,000 per ton. In the presence of ‘signature bonus’ and ‘premium’ implementation of OGRA’s notified price would be not possible, he noted.

Ali Haider has urged the federal government to chalk out a mechanism to determine prices of locally produced LPG keeping in view the cost of production in order to give relief to the common people. End of ‘signature bonus’ and ‘premium’ will largely benefit consumers, he added.