The Hindu Business Line : Govt may allow pvt cos to sell surplus domestic LPG

THE Government is planning to allow sale of surplus domestic LPG by private sector `parallel marketing' companies. The Petroleum Ministry is preparing a Cabinet note on this issue. Although there has been a robust growth in LPG demand this year of over 10 per cent, there is a lean season during the summer months when supply outstrips demand.

Reliance is a key producer of LPG, accounting for 25 per cent of the domestic demand of around 8 million tonnes. It has been pushing for an outlet for its products during the lean season and the Ministry's move will augur well for its refinery business.

The parallel marketing system for kerosene and LPG was introduced in April 1993. This allowed import by private companies and sale at market prices. The primary marketing system is through the public sector oil marketing companies which sell LPG and kerosene at subsidised prices.

LPG imported and sold through the parallel marketing system was around 5,00,000 tonnes in fiscal 2002-03.

Recently, the Government imposed a ban on import of kerosene by parallel marketers in a move to curb adulteration of diesel. Under the new dispensation, kerosene can be imported only through state trading enterprises.