Laugfs Gas still in quest to achieve ‘equilibrium price’

BY SANATH NANAYAKKARE

‘We all need to have sound judgment as we try to solve the impact of the world LPG prices on the local market at a critical time like this for the country’, Lasantha Alagiyawanna, State Minister of Cooperative Services, Marketing Development and Consumer Protection told The Island last week.

The minister said so when asked about Laugfs Gas PLC’s claims made in a letter addressed to the Consumer Affairs Authority (CAA) that the recent price increase stipulated for Laugfs domestic LP gas cylinders was not reasonable.

Laugfs has sent this letter to the CAA while already complying with the current price set by the Authority.

Accordingly, in the letter sent by Laugfs Gas PLC Group Managing Director/GCEO P. Kudabalage to the CAA, he states, “We have been informed by your letter dated 12 August 2021 that the Consumer Affairs Authority has granted approval for increasing the maximum retail price of domestic LPG cylinders by Rs. 145 for 5 kg cylinders and by Rs. 363 for 12.5 kg cylinders. Accordingly, we are informed that the new maximum retail price of a 5 kg domestic LPG cylinder will be Rs. 743 and that of a 12.5 kg domestic LPG cylinder will be Rs. 1,856.”

When we spoke to W.K.H Wegapitiya · Chairman – Laugfs Holdings, he said that a Laugfs Gas shipment was on its way to Sri Lanka and arrangements could soon be in place to distribute the commodity.

When asked if the operations of the company would be sustainable in the medium term under the new prices, he said, “Not really. We have informed the CAA about our stance on the LPG pricing formula and we look to the future with realistic expectations. There should be an addition of another Rs. 475 per cylinder for our operations to be viable.”

Laugfs chairman also raised his concerns about USD to LKR exchange rate on the market.

Minister Alagiyawanna told us that this was not a time to revisit the issue as it has been settled to a great extent. Laugfs Gas PLC has agreed to bring in 10,000 metric tons and start distributing. We are facing multiple problems on the pandemic front, economic front amid increasing world energy product prices. Common masses are burned enough and we can’t burden them any more,” he said.

Meanwhile, a Laugfs gas distributor in the Colombo District told this reporter yesterday that he received a meagre supply of Laugfs gas on Saturday which was grabbed by some consumers as soon as it arrived, leaving many others unfortunate.