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Bulk LPG transporters to boycott oil company tenders

M.K. Ananth

Photo: E. Lakshmi Narayanan

Protest mode:Bulk LPG transporters will not submit tenders for new contract. —

NAMAKKAL: Bulk LPG transporters have decided to boycott the tenders to be floated by major oil companies over the issue of reduction in weight tolerance from the existing 100 kg per trip to 40 kg per trip for the new three-year contract that would come into effect from November 1.

The decision was taken unanimously by members of the Southern Region Bulk LPG Transport Owners Association (SRBLPGTOA) against tenders issued by Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, said association president M. Ponnambalam.

He told The Hindu that every three years, the companies floated tenders to transport LPG from their loading units to the bottling plants.

The new tenders were floated on May 15 for commencement of contract for the next three years from November, he said and added that the tenders have to be submitted before June 15.

Capacity

Each tanker has a capacity to hold 18,000 kg of LPG and was given a weight tolerance of 100 kg (0.55 per cent) - loss incurred while transporting or difference shown by weighing balances at the bottling and loading units.

The new tender stated that weight tolerance was reduced to 40 kg (0.22 per cent). As per the new stipulation, tanker operators would incur a loss of Rs. 70 per kg of additional weight loss - ie, they would have to pay for the entire loss if the loss exceeded 40 kg, he said.

He referred to the recent bills from companies in which weight difference in machines at the two end points ranged up to 100 kg. “At times, the machines have shown an increase in the quantity delivered by us at the bottling units though it could not practically happen,” Mr. Ponnambalam said.

“The oil companies treated this as technical error and did not pay us any additional amount but charged us when the machines showed a drop in the delivered quantity,” he lamented.

“At the general body meeting held in Namakkal on May 21, the members unanimously resolved to make a representation to the oil companies on the shortage clause (reducing the tolerance weight). Executive Director (LPG) of Indian Oil Corporation Ltd. Satwant Singh invited us as well as representatives from all the four regions in Indi for a meeting on May 31 and explained that the reduction was based on a CAG report,” Mr. Ponnambalam said.

He added that the Executive Director listened to their grievance and assured to get back to the association after explaining their cause to the CAG. After chairing an urgent general body meeting for the members on Friday, Mr. Ponnambalam said that the members have unanimously decided to take part in the tender process only if the shortage clause was removed.

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