ISLAMABAD, May 9: The government has granted licences to three local and multinational companies to market liquefied petroleum gas (LPG) in the country.

Under Liquefied Petroleum Gas (Production & Distribution) Rules 2001, no company shall, without first obtaining a licence, undertake or cause to be undertaken under any agreement the construction and operation of works, official sources said.

The three companies include Petrosin Gas of Singapore, Kel Oil of Malaysia and Best Gas, a local company. Three international already involved in the LPG marketing include Shell, Caltex and SHV. In addition to this, there are about 15 small and medium size local companies in the LPG marketing.

The sources said that a number of other companies had applied for the marketing licence but could not meet the requirement under the relevant rules. Licence fee for the licence is Rs100,000 payable in the government treasury.

Petrosin Gas has six engineering businesses and is involved in extensive manufacturing and engineering facilities in Pakistan having accreditation of ‘U’ and ‘S’ stamps.

The company has constructed and manufactured major gas and oil processing plants in Pakistan including three LPG plants. The Pak-Arab Refinery Limited (PARCO) has allocated 5 tons per day (around 1.25 per cent of its total production) to Petrosin for marketing. The company is in negotiations with other producers to increase its supply to 100 tons per day by end-2002.

Kel Oil Limited is a joint venture of Keloil International Malaysia and Starling International Venture, UK. The present business of the company is LPG storage, terminal and import and distribution in Malaysia.

It will utilize the main storage facility at Port Qasim for off-loading and storage of LPG, which will be marketed through distribution network from its own filling plant to be established near Fateh Jang, Rawalpindi.

Kel Oil’s gas bottling project shall initially cater for marketing of 30 tons of imported LPG per day (9,000 tons per annum) within estimated capital cost of Rs115 billion for bulk storage and bottling facility.

Best Gas is a new local company that plans to market LPG through local as well as imported LPG.

Despite surplus LPG production after the completion of PARCO refinery around two years back, supply of LPG, most of the time, goes short in far flung areas particularly in Azad Kashmir and Northern Areas.

Mainly because of short supply, distributors fix their own prices in these parts of the country and seldom abide by the prices fixed by the marketing companies.