Roll-out of LPG through bunks in Kerala may take time

Rolling out the project to sell 5-kg non-subsidised LPG cylinders through fuel bunks may take more time in the State going by the feedback from oil companies.

The project is likely to be a boon for ballooning floating population fuelled by the growing IT and construction sectors. They often find it difficult to secure LPG connection. Once implemented, it will enable a customer to take home LPG cylinder from a petrol pump by just flashing an ID proof.

A senior official of a major oil company told

The Hindu that the project would take time. Potential petroleum dealers would have to be identified since all bunks cannot be covered under the project. Safety parameters like storage space that was flame-proof and devoid of electric connection should be ensured besides securing quite a few approvals, including the explosive licence, the officer said.

Pricing will be volatile since it will be market-driven. For instance, in Chennai where the project has been implemented, a first-time customer has to pay Rs. 1,649 per cylinder – Rs. 1,000 towards the cost of the cylinder, Rs. 145 as VAT and Rs. 504 for LPG (LPG price changes monthly with marker prices). The price goes up to Rs. 2,133 if the cost of regulator and hose, sales tax, and administrative or handling charges of petroleum dealers are also factored in.

Unlike in the case of domestic subsidised LPG where the oil company remains the owner of the cylinder, under this project the ownership is transferred to the customer. He will have the option to surrender the cylinder in which case he will be able to get a refill by paying LPG price alone.

Senior official of another oil company said it had not received any circular on the implementation of the project in the State. Initially, the project is likely to be restricted to a limited number of cylinders through selected company-owned and company-operated fuel bunks. “We are not expecting a huge demand from the very outset. Since five or ten cylinders weighing probably 50 kg will be kept at each fuel pump, separate licence may not be needed,” he said. The Gas Cylinder Rules exempt from taking licence for possession of LPG not exceeding 100 kg at any one time.

However, R. Sabarinath, national joint secretary of the Federation of All India Petroleum Traders (FAIPT), an umbrella body of fuel bunks in the country, was confident that the project would be rolled out in the State in the next three months.