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Oral Questions Reply- 22nd June 2011

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Parliamentary Question No: 0720/2010 Reply is on 22nd Tune 2011



(a) (i) The date of signmg the Agreement with Mis. Laugfs Gas Pvt. Ltd (LG) was 06.09.2001. Subsequently an amendment to the original Agreement was signed on 17.1.0.2002.

(ii) The agreement states -The gove~ent of Sri Lanka is desirous of ensuring the distribution of LPG to' the general public at a competitive price in the interest of the national economy.

(ill)

No.

(iv)

The Cabinet of Ministers had decided to sign the Agreement on the verbal inscructions of the Former H.E. the President.

(v)

After authorizing the Cabinet of Ministers, then Secretary to the Treasury - Mr. P.B.Jayasundera, Then Chairman of Ceylon Petroleum Corporation - Mr. Ani! J Obesekera, Laugh Gas (Pvt) Ltd signed the agreement.

(vi) Conditions to be fulfilled by Laugh Gas (Pvt) Ltd «LG): . .Submission of a Performance Guarantee of Rs. 4.5 million. .Show proof of having 60,000 cylinders before the signing of the

Agreement.

  • Show proof of having 120,000 cylinders w.1thin 60 days of signing of the Agreement.
  • Weekly payment for the LPG purchased from Ceylon Petroleum Corporation.
  • Sell the Domestic cylinders Rs. 100.00 below the Shell Gas selling
  • Sell the commercial cylinders Rs. 320.00 below the Shell Gas selling price.


(vii) No.

(b) (i) Yes.


LG shall not charge more than Rs. 2,000.00 for domestic ~Unders and not more than Rs. 3,000.00 for -commercial

cylinders as deposits from consumers.

Purchase' the total daily production of LPG from the Ceylon Petroleum Corporation.

Second year, LG shall meet the additional demand by importing LPG sufficient. t.ome.et 20% of demand.

Third year, LG shall meet the additional demand by importing LPG sufficient to meet 30% of demand.

Laugh Gas «Pvt) Ltd shaiI only use the Ceylon Petroleum Corporation produced LPG for filling Domestic and Commercial cylinders.

(ii) Ceylon Petroleum Corporation does not have filling facilities and empty gas cylinders to commence selling of Ceylon Petroleum Corporation's produced LPG.

(ill)

The production of LPG at CPC Refinery is limited to 12% of demand of the country and Ceylon Petroleum Corporation does not have import facilities to import the balance requirement of the country.