The Hindu Business Line : LPG shortage situation to ease soon: Aiyar

THE Petroleum Minister, Mr Mani Shankar Aiyar, informed the Lok Sabha on Wednesday that the shortage situation of liquefied petroleum gas (LPG) in the country is expected to normalise soon.

The oil marketing companies (OMCs), which had restricted the release of new connections since September in view of the temporary LPG shortage, have accepted the Ministry's request to release new connections from December 1, the Minister said.

Informing the House about the action taken by the Ministry to bring the situation under control, Mr Aiyar said through a combination of inventory management and imports, directly handled by a composite task force of the OMCs under the close supervision of the Government, it was possible to tackle the problem of physical shortage.

In addition to the arrangements made earlier by OMCs to import 642,000 tonnes of LPG in October-December 2005, steps were taken to import extra 238,000 tonnes during this period. Of this extra requirement, 138,000 tonnes has arrived, Mr Aiyar said, adding: "Thus, the overall physical shortage in the country at present has been reduced to only about 1.5 per cent of the average monthly consumption of LPG."

"However, the backlog at the micro-level may vary from market to market on account of operational reasons," he said. The situation was expected to normalise further on restoration of production at Reliance Industries Ltd's (RIL) refinery. The Petroleum Ministry has also alerted the State Governments to the imperative need to curtail diversion and other malpractices.

LPG requirements are met by a combination of domestic production and imports. "A temporary shortage of LPG emerged in September 2005 on account of various factors," he said. Public sector undertakings' production during April-September 2005 was 303,000 tonnes less than planned. Consequently, physical inventories with OMCs declined from 333,000 tonnes at the beginning of April this year to 190 TMT at the beginning of October 2005.

Also with effect from October 4, RIL, the single largest domestic supplier of LPG, shut down its fluidised catalytic cracker unit at Jamnagar for maintenance work, the Minister informed.

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