The Government has ordered lPG producers like Reliance Industries to supply all the cooking gas (lPG) they produce locally to state-owned oil companies only, and private retailers have been asked to source their requirements through imports.
The Ministry of Petroleum and Natural Gas, in an order issued this month, stated that ‘sale of indigenously produced lPG is not permitted to the entities other than Government oil companies.’ All domestically produced liquefied petroleum gas (lPG) should necessarily be sold to PSUs for subsidised sale to consumers. While India is surplus in refining capacity, it does not produce enough lPG to meet all of its demand. It imported 8.7 million tonnes of lPG in 2015-16 and 4.66 million tonnes in first half of current fiscal. lPG is produced by both public sector firms like Indian Oil
Corp ltd (IOC) as well as private firms like Reliance Industries ltd. The ministry said instances have been noticed of all locally produced lPG not being sold to oil marketing companies - IOC, Bharat Petroleum (BPCl) and Hindustan Petroleum (HPCl). “Some domestic lPG is also being sold to parallel marketeers in violation of Ministry's order,” it said. “All domestic producers of lPG need to ensure compliance with provisions of lPG (Regulation of Supply and Distribution) Order, 2000 and lPG (Regulation of Use of Motor Vehicles) Order, 2001 and sell domestically produced lPG only to Government oil companies.”
Ministry held that sale of lPG by domestic producers to anyone other than state-owned oil marketing companies (OMCs) is not permissible under lPG control order. Non-state lPG sellers, called parallel marketeers, cannot source the fuel from domestic refiners. They have to import lPG if they intend to sell the cooking fuel in domestic market.
It asked all lPG producers including Oil and Natural Gas Corp (ONGC), GAIl India ltd and RIl as well as parallel marketeers to comply with the order. RIl, the largest single location lPG producer in the country, had in 2013 contested the ministry view, saying rules do not mandate that all domestic lPG must be sold only to state firms.
