Govt asks refiners to maximise LPG production, OMCs to prioritise supply to domestic consumers

The Ministry of Petroleum and Natural Gas (MoPNG) has asked oil refining companies to maximise production of liquified petroleum gas (LPG) and make it available to the three public sector entities — IndianOil, Hindustan Petroleum and Bharat Petroleum — to be sold to consumers for domestic consumption only.

“All oil refining companies operating in India shall maximise and ensure that propane and butane streams produced, recovered, fractioned or otherwise available with them are utilised for production of LPG and make it available to the three public sector oil marketing companies,” an order issued on March 5 read, adding, “All public sector OMCs shall ensure that LPG so produced is supplied/marketed solely to consumers of domestic LPG only.”

The order further seeks that oil refining companies “shall not divert, utilise, process, crack, convert or otherwise employ propane or butane streams for manufacture of petrochemical products or other such downstream derivatives.”

For context, the cooking fuel is formed of a combination of propane and butane.

Overall, the order seeks to re-prioritise allocation of propane and butane streams for utilisation in production of the cooking gas to safeguard the domestic consumers amidst a global fuel supply paradigm emanating from the ongoing conflict in West Asia.