NOC Hikes Commission for Gas Dealers

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April 25: Liquid Petroleum (LP) Gas dealers will get extra commission after Nepal Oil Corporation decided to increase their commission effective from Thursday, April 25.

Despite the hike in commission, the gas dealers are still expressing their disappointment claiming the commission amount is still minimal.

The state-run oil monopoly had increased the commission for the dealers from Rs 236 to Rs 263.89 per cylinder on April 5, 2019. The government has been bearing the transportation cost while importing LPG from Barauni-based depot of India to Kathmandu. As per the decision of NOC, the transportation cost of LPG has also surged by Rs 27.89 per cylinder.

“We were compelled to increase the transportation cost as the import and sales of LPG was about to halt following the strike of dealers,” said Executive Director of the NOC, Surendra Poudel, adding, “The commission has been increased in such a way that it won’t have financial burden to the corporation.”

NOC had earlier formed a taskforce under the direction of the Ministry of Industry, Commerce and Supply to give suggestion on this matter. Poudel said that NOC decided to increase the commission amount according to the suggestion of the taskforce.

Poudel further said that the increase in commission has been adjusted in such a way that the consumers won’t feel any burden while purchasing the cooking gas.

Bhanu Khanal, deputy spokesperson of NOC, said that the industrialists can earn commission up to Rs 960 million per annum from the decision.

Nevertheless, gas industrialists are still disappointed with the decision. LP Gas Industry Association’s President Gokul Bhandari said that the government has showed irresponsible behaviour by increasing the commission by only Rs 27. 89 per cylinder. He claimed that the dealers are running their business at a loss of Rs 100 per cylinder for transporting the cylinder.

Nepal imports 40,000 metric tons of cooking gas per month. One ton of LPG amounts to around 70 cylinders. It means that the country consumes 2.8 million cylinders of LPG every month.