Press Release
October 26, 2009

LPG BILL SHOULD NOT DISCRIMINATE
AGAINST INDEPENDENT PLAYERS - PIMENTEL

Senate Minority Leader Aquilino Q. Pimentel, Jr. (PDP-Laban) today said the bill aimed at ensuring the safety of liquefied petroleum gas (LPG) or cooking gas should not discriminate against independent players.

Pimentel stressed this point in the light of allegation that the bill will unduly favor the big players at the expense of independent refillers to the extent of easing them out of the LPG market.

"For as long as the independent players comply with safety standards in supplying LPG cylinders to consumers, they should be treated in the same way as the principal players," he said.

Pimentel said he was told that consumers from the low-income classes prefer to buy their LPG tanks from independent players because they offer lower cost.

Government data show that two-thirds or more than 60 percent of the LPG market is supplied by the Big 3 - Shell, Petron and Total. Shellane is the brand name of Shell LPG while Gasul is sold by Petron. About 25 percent of the market is supplied by a bulk handler called Liquigas which does not carry a brand in the market but only supplies to the independent players which, in turn, fill up the LPG tanks regardless of brand.

The bill will require LPG manufacturers, suppliers and consumers to replace LPG cylinders and accessories (hose, gasket and pressure regulator) which are defective or faulty with new ones which are compliant with safety standards prescribed by the government.

However, Pimentel said not all the estimated 10 milllion households that use LPG for fuel could afford to purchase new gas cylinders which cost from P500 to P900 each.

The senator from Mindanao said he has no quarrel with the recommendation of the bill's authors to designate the Department of Energy, instead of the Department of Trade Industry, as the government agency tasked with regulating and supervising the LPG industry.

However, Pimentel said that the DOE is not fully capable of undertaking such function, considering that it lacks the necessary personnel and it does not have branch or field offices in the regions outside of Metro Manila.

To address this deficiency, he suggested that local government units be deputized under the proposed law to enforce the regulatory functions over distributors, refillers and retailers of LPG products.

Pimentel also called for the adoption of measures that will prevent officials and personnel of the DOE and the deputized LGUs from abusing their authority and engaging in extortion and other corrupt activities that would compromise the bill's objective of preventing LPG-related fires.

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