The commission has pinpointed that the gas market is largely segmented into commercial consumers and household consumers, and owing to the single pricing structure, subsidy pledged for household users is being unduly consumed by commercial ventures.

The recommendation of the commission, submitted to Ministry of Industry, Commerce and Supplies (MoICS) recently, goes in line with Nepal Oil Corporation's past reports.

According to an estimate, some 40 percent of the gas imported in the country is consumed by commercial ventures. The corporation has long pointed out that plugging this unwanted loss alone would reduce its monthly loss by one third.

Presently, the government is extending a subsidy of Rs 300 per cylinder to household consumers. That is causing NOC to bear a loss of about Rs 170 million, said officials.
The commission has further suggested that the government come up with separate laws to govern the gas market, transportation of gas and standard of cylinder.

Gas business, at present, is governed by a code of conduct of Department of Standard and Metrology (DoSM). But it lacks enforcement measure.

It has also made recommendations for companies to publish matters related to public awareness at least once a month.

The MoICS had constituted the commission on directives of Commission for Investigation of Abuse of Authority (CIAA). CIAA had issued the directives on receiving numerous complaints on anomalies in the gas market.

Source: The Kathmandu Post, August 1, 2007