— Fueling the Future: Government grants approval for installation of LPG air-mix plants by private sector
ISLAMABAD: The government has given its approval to policy guidelines for the installation of LPG Air-Mix Plants (AMP) by the private sector.
The guidelines outline various provisions and regulations to govern the operation of these plants, ensuring transparency and compliance with regulatory standards.
According to sources of the petroleum division, the Directorate General of Liquefied Gases of the Ministry of Energy (Petroleum Division) has communicated the approved policy guidelines to the chairman of the Oil and Gas Regulatory Authority (OGRA).
Key points from the approved policy guidelines include: Private sector entities are allowed to establish LPG AMPs based on commercial considerations, bearing the costs and liabilities associated with the setup, while fulfilling OGRA’s licensing and operational requirements.
LPG AMPs developed by the private sector are exempted from the LPG supply preference or dedication mentioned in clause 3.1.1 and 3.6.7 of the LPG Policy 2016. However, they may purchase LPG in bulk at the Producer’s Price notified by OGRA.
Tariffs for LPG AMPs developed and operated by the private sector will be deregulated. The status of LPG-Air Mix Plant Licensee will be equivalent to that of LPG Storage, Filling, and Distribution Plants, allowing them to import LPG in accordance with prevailing trade policies and other applicable regulations.
Consumers and suppliers of LPG AMPs will have the freedom to switch to alternative competing fuels offered by third parties, including piped natural gas, LPG cylinders, other LPG Air Mix Plants, or Virtual LNG projects.
LPG AMP licensees will be required to notify consumers of the monthly tariffs and submit detailed tariff information to OGRA by the 10th of each month.
“The LPG AMP licensee of such plant will notify monthly tariff for information of consumers and also submit detail of monthly tariff to OGRA latest by l0th of every month,” said the policy guidelines.
OGRA will ensure that LPG AMP licensees do not take any measures to hinder the marketing of LPG cylinders in the areas where LPG Air Mix is supplied.
Complaints regarding the distribution and metering of LPG through the pipeline network will be addressed by OGRA, similar to the existing practices in the natural gas sector.
The Directorate General of Liquefied Gases of the Ministry of Energy has advised OGRA, as the regulator of the LPG sector, to comply with the policy guidelines mentioned above and keep the petroleum division informed of their implementation.
It is pertinent to mention that these approved policy guidelines aim to facilitate the establishment and operation of LPG Air-Mix Plants by the private sector, ensuring fair competition, consumer information, and adherence to safety and regulatory standards.