UNSCRUPULOUS TRADE

LPG suppliers to boycott illegal dealers amid crackdown

LPG suppliers will boycott retailers who continue re-selling their cylinders with other companies’ gas.

In Summary

•The Energy and Petroleum Regulatory Authority (EPRA) has mobilised more than 80 inspection officers for a countrywide crackdown on illegal gas refilling, in support with county governments, police and DCI.

•Illegal refilling of gas attracts a Sh10 million fine, five years in prison or both.

Leading cooking gas dealers will boycott retailers using their  cylinders to illegally refill other brands, the Petroleum Institute of East Africa has warned.

This comes at a time when the industry is adopting new rules introduced in June which abolished the mandatory cylinder exchange pool, which allowed open trading and exchange  of gas cylinders by oil marketing companies, retailers and consumers.

Under the new law, LPG retailers including shops and supermarket outlets, wholesalers and transporters are required to acquire a licence from the Energy and Petroleum Regulatory Authority (EPRA) for each business location and shall deal with specific brands  authorised by the brand owner.

 

The mandatory exchange pool rule ceases in December after a six-month transition window extended by EPRA, to "allow small traders to comply".

"There is no six-month transition period on illegal cylinder refilling," PIEA chairman Olagoke Aluko said in a statement yesterday.

The LPG suppliers, mainly leading oil marketing companies, have moved to blacklist the illegal retailers as confusion about the six-month transition period continues.

The regulations gives marketing companies until December to return their competitors' cylinders. The marketers also have until year-end to put safe-use information onto each cylinder and to submit records of their current cylinder stocks to EPRA.

The authority’s director general Pavel Oimeke yesterday said dealers have until end of December to comply, which includes applying for licenses to deal in LPG. He has however warned against illegal refilling.

“The aspect of filling other peoples’ cylinders is completely illegal and my team on the ground is enforcing this regulation and if you are caught transporting LPG brands without authorization, either it is a vehicle or you are a refilling plant, you will be arrested and taken before a court of law,” Oimeke said.

 

In a quick rejoinder, Aluko  said:"allowing the legitimate industry time to return collected cylinders and implement the new safety rules doesn't give illegal practitioners some extra window of time for illegality. The filling and hoarding of other brand's LPG cylinders is illegal and the fines and jail terms are in force.”

 

Illegal refilling of gas attracts a Sh10 million fine, five years in prison or both.

Under the new regulations, retailers must now have an agreement with the brands they stock that is proven by a letter and must be applying to EPRA for a license.

The boycott comes as EPRA implements a countrywide crackdown on illegal gas businesses.

The regulator has mobilised more than 80 inspection officers and started working with county governments to seek out and close down illegal refilling facilities.

Yesterday, Oimeke said the regulator will from next month commence publishing quarterly empty gas cylinder prices, to guide retailers and consumers on purchasing of their preferred cylinders.