Big cooking gas dealers choke under weight of small re-fillers - Daily Nation

Big cooking gas dealers choke under weight of small re-fillers

Tuesday August 5 2014

Petroleum Institute of East Africa chairman Polycarp Igathe at Bruce House in Nairobi on August 5, 2014 during a press briefing on the current state of the oil industry. PHOTO | EVANS HABIL

Petroleum Institute of East Africa chairman Polycarp Igathe at Bruce House in Nairobi on August 5, 2014 during a press briefing on the current state of the oil industry. PHOTO | EVANS HABIL NATION MEDIA GROUP

By IMMACULATE KARAMBU
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Independent gas re-fillers are edging main stream oil marketers out of the cooking gas market supplying seven out of 10 cylinders to consumers.

Petroleum dealers’ lobby representing the main-stream oil dealers, Petroleum Institute of East Africa (PIEA) on Tuesday admitted that the trend had choked its members’ business by reducing revenue from LPG sales.

It is now warning that unchecked, the trend could compromise the safety of users with illegal gas re-fillers taking advantage.

NO LONGER TAKE RESPONSIBILITY

Consequently, PIEA said it can no longer take responsibility for the integrity of cylinders and the content that is stocked in a majority of supermarkets and retail outlets mostly located in residential estates as they “have not been filled or supplied by brand owners.”

“The institute is alarmed by the escalating cases of LPG malpractices and the reluctance by the regulator to stem the ever-increasing vice which is threatening to spiral into a crisis. PIEA has details of illegal traders and illegal and unlicensed LPG storage and cylinder filling facilities,” PIEA chairman Polycarp Igathe said.

The institute faulted the Energy Regulatory Commission (ERC) alongside the police and county commissioners for “lack of willingness” in dealing with the situation.

It called on the Ministry of Energy and Petroleum to adopt a policy that will see oil marketing companies revert to LPG valves that are specific to companies as a measure to curb illegal refilling.

SHIFTING TAXES

PIEA also urged the government to consider shifting taxes that are currently charged on LPG and associated accessories to kerosene so as to promote the use of clean fuel.

“We have made certain proposals to the policy makers. We think that the best way is to go back to a specific valve.

‘‘We are recommending that as a policy of last resort,” Mr Igathe said.

Last year, the quantity of petroleum products imported into the country stood at approximately four million tonnes, according to industry information released by the Kenya National Bureau of Statistics.

Monthly consumption is currently estimated at 275,000 tonnes for local consumption and 80,000 tonnes for export.

However, LPG uptake in the country is still low, at less than 10 per cent, a situation that has been blamed on high prices for the product and accessories.

Cooking gas prices are currently not regulated by the ERC as is the case with fuel leaving consumers vulnerable to unfavourable market conditions.

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