Gas industry transparency an explosive issue

Saturday, Sep 21, 2013 13:19

Northern liquefied petroleum gas company (LPG) in Nam Dinh Province provides 20,000 tonnes of gas to the market. — VNA/VNS Photo Ha Thai

HA NOI (Biz Hub) —Trade fraud is an increasing problem for Viet Nam's gas industry, said Tran Trong Huu, deputy general secretary of the Viet Nam Gas Association, at an online discussion in Ha Noi on Thursday.

Market watch teams dealt with 400 gas trading violations in the first eight months of the year, confiscating over 15,000 gas tanks and collecting penalties that totaled VND2 billion (US$95,200). Many enterprises used fake gas tanks to pump gas themselves from remote areas, said Do Thanh Lam, deputy head of the ministry's Market Management Department.

Huu said that authorities were too lax in granting licences to gas businesses.

Viet Nam has 23 businesses importing and distributing liquefied petroleum gas (LPG), according to Nguyen Loc An, deputy head of the Ministry of Industry and Trade's Domestic Market Department.

Monopoly is another pervasive problem for the gas industry. Last year, about 150 households in Ha Noi complained to the Viet Nam Consumer Protection Association (Vinastas) that the Red River Petroleum Company had cut their gas supply because of a dispute over the price increase and would not allow other firms to supply them with gas. Nguyen Manh Hung, vice chairman and general secretary of Vinastas, singled out PVGas – which holds 70 per cent of the gas market – as another potential concern.

During the discussion, participants also voiced worries over the surge of gas prices in the past few months. Retail gas prices recently rose VND4,250 per kilo or VND51,000 per 12-kilo gas tank due to the world increase. Since the beginning of the year, the price has risen by VND77,000 per tank.

Consumers should be quickly and accurately informed about such changes, Hung said, since the gas price was an important factor in their cost of living.

Nguyen Minh Phong, head of the Ha Noi Institute for Socio-Economic Development's Economic Research Division, said the Government should prevent businesses from controlling gas prices by requiring agencies to sell gas at list price.

Lam proposed revoking the business licences of firms that violated LPG trading regulations.

Last year, the country's total gas consumption was 1.24 million tonnes. Industrial and transport units accounted for around 35 per cent of gas consumption while commercial units and households consumed 65 per cent. — VNS

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