ISLAMABAD: The Sui Southern Gas Company Ltd (SSGCL) on Thursday accused ‘front men’ of Liquefied Petroleum Gas (LPG) market operators of making complaints before the government institutions to block state-owned entities’ retail business for creating shortages and black marketing the product for personal gains.

“Most of the complainants are self-proclaimed stakeholders and they themselves do not have any stakes in the LPG market yet they have invariably been involved in making false allegations against SSGCL and its subsidiary SSGC LPG Ltd (SLL),” a statement issued by SSGCL said.

“Quite clearly these false allegations are being orchestrated by front-men of those individuals whose objective is to benefit from the situation to create shortages and create a black market of LPG for their personal gains,” the statement added.

The company issued a statement after its senior executives were reported to have responded to queries from an investigation team of the Federal Investigation Agency (FIA) on allegations of illicit LPG imports in violation of procurement rules forwarded by the Special Investment Facilitation Council (SIFC).

In response to those queries, the SLL — a wholly-owned subsidiary of SSGCL — was operating an LPG Import Terminal at Port Qasim Authority (PQA). A fully integrated LPG marketing and distribution company under the Ministry of Energy, SLL has over the years emerged as the largest importer of LPG in Pakistan through a transparent bidding process as required by public procurement rules. All these imports are being made through opening letters of credit which are retired through normal banking channels.

On the directives of the Ministry of Energy, SLL increased its LPG imports to avoid shortages of LPG during peak demand seasons and not to provide any room to black marketers who take advantage of these shortages to artificially increase the prices of LPG and earn extra profits from the consumers.

The SLL said more than 250 LPG marketing companies were operating in Pakistan. SLL did not have any local allocation of indigenously produced LPG and was dependent on imports and yet its market share is about 8pc which could not be termed as monopolistic by any means “whereas the other similar companies are operating with larger market share”.

The company explained that the price of indigenous LPG was always lower than imported LPG whereby the importer had to keep its selling price within the Ogra-announced price, equal for importers as well as those having quotas from local producers. Therefore, there is no room for extra profit taking for companies depending upon imports such as SLL.

Published in Dawn, March 15th, 2024