Gas distributors warn of transport crisis

 
Commanding a controlling stake of 73 per cent of the LP gas market, distributors of the state-run Litro Gas today (Wednesday) warned of an impending crisis in its distribution in different parts of the country unless their margin costs were increased by 12 per cent.
Raising awareness of their relevance, the LP Gas Distributors Association President Sathyendra Wijayapura said that the margin for distributors and dealer for gas distribution that had not been reviewed since 2007 should be revised to 12 per cent with 7.5 per cent for distributors and 4.5 per cent for dealers.
In addition, he noted that the transport margin needs to be amended to a minimum of Rs.7 per km within Colombo and a sufficient increase for all other districts. This would mean that the cost increase per cylinder would be Rs.75.
Mr. Wijayapura, at a media conference, pointed out that distribution could get stalled starting from different parts of the country should the current crisis continue and their distribution costs continue to rise.
The association noted that the key issue they faced was the significant increase in transport and related overheads due to the increase in the price of diesel to Rs.123, the increase in vehicle spare parts ranging from tyres to oils and high cost of human capital for what is a specialized job that requires regular training.
The President noted that attempts to have meetings with relevant authorities including Ministers Rishad Bathiudeen and Malik Samarawickrama had proved futile.
The Consumer Affairs Authority (CAA) is the sole authority capable of revising the rates and the margins in terms of gas distribution costs.
The last increase in the gas distribution cost was in 2015 when Litro granted an increase by 2.56 per cent that helped to cushion the margins for dealers and distributors.
The gas distribution network blames authorities for not heeding their call for a margin revision insisting that if the banks stop payments for loans in future they would be compelled to stop distribution. 
Litro Gas which enjoys over 73 per cent of the market is servicing 4.3 million households in the country through its network of 35 distributors that transport gas cylinders on its 600 fleet of prime mover trucks daily. The other LPG supplier is Laugfs. (SD)