News
Laugfs-Litro rivalry adding fuel to gas scarcity
View(s):By Sajeniya Sathanandan
The cooking gas scarcity continues into its third week, largely affecting households and small-scale businesses despite government assurances of an uninterrupted supply.
Long queues were seen across the country, with some outlets closing their shutters.
Litro Gas dealers said they are receiving fewer supplies than their order, while Laugfs Gas PLC noted that the storage issue remains unresolved.
Addressing Parliament on Tuesday, President Anura Kumara Dissanayake said the Hambantota terminal would be available for gas storage. But Laugfs said it has not yet been officially informed about the use of the facility.
A queue for gas in Badulla: Pix by Prasad Rukmal
A senior Laugfs official said the authorities were not even responding to their calls.
He said Laugfs was ready to pay penalties, duties, and taxes if permitted to use the terminal for building a buffer stock. Laugfs has not yet received a formal response, despite submitting the relevant documents to the Treasury and Litro.
He added that the state-owned Litro views Laugfs as a rival rather than a partner and is reluctant to share the terminal—even though ultimately it is the public who will benefit.
Without naming Laugfs, President Dissanayake told Parliament that the government has negotiated with a private company to make available 15,000 metric tonnes of storage in the 30,000-metric-tonne Hambantota facility, which is reserved for emergency needs.
Laugfs Gas says that the storage issue remains unresolved
Under emergency regulations and the Essential Services gazette, the government has temporarily allowed a private company to sell more than its usual 20% quota to the local market. The move, the President said, is aimed at easing the shortage of yellow gas following the collapse of the company’s export markets.
To address the cylinder shortage, 100,000 units have been ordered and are expected to arrive next Thursday. These will enable consumers to switch to Litro Gas, which is priced Rs. 500 lower, he added.
The President noted that with these strategic interventions and improved infrastructure management, the risk of a gas crisis was currently minimal.
The country’s total gas storage capacity stands at just 8,000 metric tonnes—enough for one week’s consumption.
Because of this limited capacity, the government has stationed a ship in the Maldives, with smaller vessels transporting 800 metric tonnes of gas to the port every two days to maintain a steady supply.
Daily demand for Litro Gas typically ranges between 700 and 1,200 metric tonnes but recently surged to 1,800 metric tonnes due to supply disruptions in the private sector.
The ongoing conflict in the Middle East and the closure of the Strait of Hormuz have left over 100 LPG vessels stranded. This has resulted in increased war risk insurance premiums, higher logistics costs, and rising world market prices, making the establishment of a domestic buffer stock even more critical for national security, LAUGFS Gas PLC said.
Because the Hambantota terminal is non-operational, Laugfs has had to import LPG through Colombo using small ships and a limited 3,000-metric-tonne storage facility in Mabima.
The company receives about 3,500 metric tonnes of shipments weekly.
Litro Chairman Channa Gunawardana said gas cylinders are distributed to 14,000 dealers every morning. As the current demand is high, stock often runs out by noon due to panic buying, meaning customers who arrive later will find no cylinders until the next morning’s delivery.
Litro has ordered 38,000 metric tonnes for this month, which is 6,000 metric tonnes more than the usual monthly order of 32,000.
He told the Sunday Times that the problem would be resolved shortly because the total quantity coming into the country exceeds the demand.
Asked why the dealers are given less than the quantity they ordered, he said, “That might be possible, yes,” and explained that the measure was necessitated to fill the supply gap created by the competitor.
The Sunday Times learned through several gas retailers in Jaffna, Kandana, and Nawala about their current stock. For about 20 days now, every shop has been receiving fewer cylinders than usual.
Selling has become difficult because customers are panicking and getting aggressive to get whatever they can. On top of that, supply trucks are inconsistent; they might show up at 8:30 a.m. or as late as 4 p.m., dealers say.
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