Controversy over LPG supplier in ‘influential’ deal
State-owned Litro Gas Lanka Ltd with a market share of 75 per cent of liquified petroleum gas (LPG) is to make a costly change by replacing the present selected LP gas supplier, company sources said, adding that an influential party is behind this deal.
Newly-appointed Litro Chairman Muditha Peiris disclosed to reporters recently that a decision has been taken to purchase gas from the long-term distributor in Oman for the next four months.
A shipment of around 3900 metric tonnes (MT) of LP gas has been unloaded but it was not sufficient to avert the present shortage, he said adding that there were no other shipments arranged by the previous top management of the company.
People have continued street protests daily blocking roads demanding cooking gas after waiting in queues for days as Litro has failed to ensure a continuous supply of LP gas due to the dollar crisis.
Two years ago the Cabinet of Ministers approved the proposal presented by the Minister of Finance, Economy and Policy Development to award the contract of purchasing 740,000 litres of LP Gas for Litro Gas Lanka Ltd to M/s Oman Trading International Ltd for the period of two years from March 1, 2020.
Thereafter without extending this term contract of Oman Trading whose term of supply LP gas expired on March 1, 2022, the Litro Company has taken measures to award the tender to Thailand’s Siam Gas Company for four months following proper procurement process and it received the cabinet approval on May 3.
But suspending this May 3 decision, Litro has now decided to grant the contract back to Oman Trading International Ltd the previous supplier creating confusion while foregoing a large sum of dollars due to price difference quoted by the two companies, official documents revealed. Informed sources said the son of an influential public official was behind the Oman deal. Siam Gas Company has quoted the price of the CIF value of US$ 96 per metric tonne of LP gas while the price of Oman Trading was much higher at $129 per metric tonne. Therefore the government has to pay $33 more for the new arrangement.
According to Finance Ministry sources, the price of a LP gas cylinder will go up to Rs. 7000 by buying LP gas from Oman Trading compared to the Siam Gas price of Rs. 5000. Litro Gas Lanka says a request has been made from the authorities to increase the price of domestic gas cylinders by Rs. 200.
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