LAUGFS and Litro to use Hambantota storage terminal together

The government is deliberating the feasibility of maintaining a stable price for liquefied petroleum gas by allowing a public and private partnership to maintain LAUFGS terminal jointly between LAUGFS Gas and state-owned Litro Gas for storage with the aim of reducing costs.

The president has appointed a committee to study the proposal of jointly operating the LAUFGS terminal to maintain stocks of LPG for the use of two companies he explained. The cost of transport cost of two companies’ could be reduced by around $70 per metric ton by using LAUGFS Hambantota facility with a capacity of 30,000 and its other 3,000 MT terminal at Mabima.

LAUGFS’s chairman said this proposal was made by him along with two other suggestions at a meeting held with the president along with several top officials. He noted that he has also proposed to allow a price increase or government subsidy for the two companies to supply LPG cylinders at the present price of Rs.1,493. According to some reports, he mentioned there was no plan to merge the two companies.

Litro Gas has a terminal with a small capacity of 8,000 MT and it has to bring LPG shipments several times per year to meet the consumer demand. It has been revealed at the meeting that the state owned company is supplying 32.000 MT monthly to the local market while LAUGFs provides 11,000 MT to meet the total demand of 43,000 MT.

The other benefit was the possibility of purchasing LPG at a low price for both companies via a joint procurement committee by LAUGFS Terminals Ltd. 

A senior official said: “It has been agreed in principle to further study the feasibility of this proposal by referring it to a special committee.”

For more information visit www.laugfs.lk

18th June 2021