OGRA blamed for off-spec Iranian LPG import

ISLAMABAD: Oil and Gas Regulatory Authority (OGRA) was blamed for the import of substandard Iranian LPG because of failure to set up testing laboratory at Taftan or 250 and not making the JJVL LPG extraction plant functional.

Lube Gas Private Company Limited in its response to the letter of the regulator about the compliance of notified LPG quality specifications stated that OGRA is to be blamed for the most off-specific product coming from Iran. It said that the sale of substandard Iranian LPG could lead to a huge disaster in the country.

The letter also said that OGRA also failed to discharge its statutory and regulatory role, for example, it was unable to resolve the pending dispute between Jamshoro Joint Venture Limited (JJVL) and Sui Southern Gas Company (SSGC), which was resulting in a loss of domestic production of almost 400 metric tonnes per day. This was inflicting a loss of billions of rupees on the national exchequer as well as a foreign exchange loss of around $200 million per year.

Once JJVL’s LPG extraction plant comes on stream, it will start catering to the energy needs of over 750,000 homes across Pakistan. And this will also help contain the increasing LPG prices that have surged a lot mainly because of the huge deficit of piped gas (local gas and RLNG) in the country.

The JJVL plant production accounts for 15 percent of the total LPG supply in the country. The plant is not operational since June 21, 2020, due to which the national kitty has suffered a loss of Rs3.2 billion till now.

“OGRA is clearly empowered and Article 6, sub-clause -2 (K) of the OGRA Ordinance 2002 requires it to resolve the dispute between OGRA Licensee companies. Despite reminders by JJVL, OGRA is unmoved and has done nothing, and is shutting its responsibility,” the letter said.

Lube Gas Private Company also said that issuing letters to LPG marketing companies while huge discrepancies continue in the market with impunity, was a waste of time. It asked OGRA to take its regulatory role seriously and enforce the LPG rules without let or favour. It urged the regulator to play its due role in making the JJVL-LPG extraction plant functional.