Wednesday, July 24, 2024

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Serious LP gas shortage in the offing soon

A serious shortage of gas is expected in the market next week, domestic gas companies warned today.The gas companies said that they are unable to import gas as banks are not issuing Letters of Credit.

As a result, they said that a serious shortage of gas is expected in the market next week.The gas companies said that they had alerted Finance Minister Basil Rajapaksa a few ago about the issue.

The gas companies Litro gas and Laugfs gas say that they are facing issues in opening Letters of Credit (LC).The gas supply of the country has encountered many issues due to the present gas crisis in Sri Lanka.

Litro Gas said steps are being taken to avert a crisis adding that a shipment of Gas has reached the Kerawalapitiya Gas Terminal and the distribution process could begin as early as tomorrow.

However, Chairman of Laugfs Gas, W.K.H. Wegapitiya said his company only has sufficient stocks to last the next three days.

He said despite the Finance Minister and other officials being informed regarding the opening of Letters of Credit, on several occasions, there was no positive response.

According to Laugfs Gas Chairman W.K.H. Wegapitiya, only 2000 Gas Cylinders are issued per day at present, compared to 40,000 Gas Cylinders that are issued usually.

Laugfs Gas, Sri Lanka’s privately owned cooking gas company is unable to import liquid petroleum (LP) gas due to a lack of dollars in the market making it difficult for the company to open letters of credit (LCs) with its banks, the company’s chairman said

“We are talking to all the banks, even Samurdhi banks, to see if they can give us dollars,” Laugfs Chairman W K Wegapitya added.

“Sri Lanka’s commercial banks and state-owned banks must organise dollars. It’s not just for us; it’s the same for importers of cement, milk powder and many others.”

“In the simplest terms any country should have foreign reserves to import products. Sri Lanka doesn’t print dollars; we print only rupees.”

He said that the company was supplying around 40,000 to 50,000 gas cylinders per day but now it’s only able to distribute around 10,000 to 15,000 cylinders after the Consumers Affairs Authority (CAA) and Sri Lanka’s Standards Institution (SLSI) increased the requirement of quality checks for gas distributors after a spate of domestic gas cylinder explosions.

Laughs Gas controls around 20 percent of the LP gas market in Sri Lanka while the state owned Litro Gas Lanka Ltd supplies 80 percent.

Litro said yesterday that the company will take at least three weeks to supply gas to reach normal market levels due to tightened safety regulations for gas distributors.

The distribution delay has already led to a black market for LP gas. A 12.5 kg cylinder, which is officially priced at 2,750 rupees, is being sold around 4,500 rupees in some places, local media reported

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