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Cost of gas and US dollar beyond any LPG operator’s control, says Liquigas
LPG importer in talks with government in a bid to utilise 4,800 metric-ton Bengħajsa storage facility
2 August 2013, 12:00am
Matthew Vella
Matthew Vella
2 min read
LPG importer Liquigas Malta is ready to discuss a new pricing model that government says will allow the company to order in bulk and utilise more of its gas cylinder storage space at its Benghajsa plant.
But the company has warned that the ultimate determinant of gas prices - the cost of gas on the international market and the US dollar exchange rate - were beyond anyone's control.
A spokesperson for Liquigas, which is one of two importers of liquefied petroleum gas, said the company was in discussion with the government to find solutions that will optimise the use of its storage facility at Bengħajsa to the benefit of all stakeholders, especially customers.
"Gas prices in Malta have, since the privatisation of Enemalta's Gas Division, been regulated by the Malta Resources Authority through a mechanism that guarantees that the final price to customers is based on controlled costs and fair purchase prices of LPG on the international market," a spokesperson for the company told MaltaToday.
Prime Minister Joseph Muscat today described the 2008 agreement with the former Nationalist government "obscene" and lacking any incentives for the gas importer to buy in bulk.
Energy minister Konrad Mizzi says the new talks will focus on the purchase of three-month stocks in a bid to push the price of gas cylinders down.
The new LPG Plant has a storage facility of 4,800 metric tons, which is double the storage capacity of the old Enemalta plant at Qajjenza. Part of the storage space available at Bengħajsa is reserved for the storage of minimum stocks levels in order to guarantee security of supply.
"The pricing model currently being discussed with the MRA will take into consideration the evolution of the international market and the tools available at global level, applied to the Maltese context.
"The main components of any final price are always the cost of gas on the international market and the dollar exchange rate. These two elements are subject to variations that are not under the control neither of Liquigas Malta nor of any LPG operator in the world," the spokesperson said.
Liquigas says it is convinced that LPG will continue to be a strong player in the Maltese energy market as a cheaper and cleaner alternative to electricity. "The efforts of Liquigas and the policy makers should be focused on improving the service to the final consumers and, in this regard, any distribution system has to respond to their rightful expectations," the spokesperson said.
Matthew Vella, a freelance journalist at MaltaToday, was formerly executive editor at Malt...
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When privatisation was discussed with the EU Commission, the price was targeted at 14 euros per bottle. Instead Liquigas raised the price to 21 euros because they had a free hand from GonziPN. This is the same business formula of Farsons who owns half of Liquigas, which is to monopolise the market and raise prices. Just a look at how Cisk beer is marketed is enough to give you a clear picture: Cisk beer cost more than the best brands like Heineken which is imported from Holland not Imriehel, and one can only find Cisk beers in 90% of Malta's bars. Who said that we will have greater choice by being EU members?
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the usual story of farsons. First they did wjat it takes to kill the other provider by bringing a lot of excuses. Now money, money money and no risks!!. The supplier from scicily was always 0ne or one and ahalf euro cheaper and the gas was cleaner and lasted longer. Enemalt ahad no right to sell the yellow cyliners to Farsons. They belong to the public because the public paud forthem. viva GonziPN
Joseph MELI •
Obviously the price paid for LPG -and in what quantity -would determine the price consumers have to pay,but why aren't these purchase prices made known,what quantities of gas were purchased ,when was it purchased and from whom or where ?As all this cloak and dagger stuff -masked under the veil of commercially sensitive claims-raises one's suspicions even further that besides market prices being manipulated and rigged they are further artifically set by the importers !
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.....and who will be responsible if the three month stock of LPG is bought at price in the market which proves in retrospect to be higher than average?
