Press Release
November 13, 2009


Senate Minority Leader Aquilino Q. Pimentel, Jr. (PDP-Laban) today agreed on the need for a legislation to upgrade the safety standards on the manufacture and distribution of cylinders used for liquefied petroleum gas (LPG) but stressed that this should not discriminate against independent or small players in the industry nor impose unnecessary financial burden on households by requiring them to pay for new cylinders to replace old ones.

Pimentel said LPG or cooking gas tanks may be old but they are safe to use although there may be a need to replace the hose or pressure regulator which may be defective.

He voiced the concern of consumers that the LPG bill, now being debated in Congress, will mandate the retrieval of at least three million gas cylinders from their users on the ground of being unsafe.

"The idea of requiring the consumers to buy a new cylinder might not augur well for those who could ill afford it," the minority leader said.

Pimentel said the bill has a laudable purpose which is to prevent fires arising from explosions of LPG tanks that cause loss of lives and properties.

He pointed out that based on official statistics, LPG-related fire accidents were mostly caused by gas leaks due to defective hoses, worn gaskets and improperly-placed hoses and gas caps.

These statistics from the Bureau of Fire Protection was cited by Sen. Mar Roxas, principal author of the LPG bill, during Senate floor deliberation.

"It has turned out that the LPG-related fires occurred not because the cylinders were defective but because of the erroneous placement of the caps on the cylinders. In other words, these were caused by the improper use and not by the cylinders themselves," Pimentel said.

The senator from Mindanao said the independent refillers, dealers and distributors object to the mass retrieval of supposedly faulty LPG cylinders because of fears that it would hit them hard while benefiting the major players that manufacture the cylinders.

The so-called Big Three - Shell-Shellane, Petron-Gasul and Total - supposedly controls two-thirds or more than 60 percent of the LPG market. A bulk handler, called LiquiGas, does not carry a brand in the market but only supplies LPG to the independent refillers, which in turn fill up the tanks regardless of brand.

He also noted the objection of independent players to a provision of the bill that supposedly adopts the position of major players that the ownership of LPG cylinders "shall be based on permanent marking on the cylinders." This means that only the company whose brand or trademark permanently appears on the LPG cylinder should be authorized to refill it."

Pimentel said the proponents of the LPG bill are contemplating a system whereby households need not pay for the cost of the new cylinders but will be required only to make a "deposit." Also the consumers may be allowed to obtain the cylinders on a lease or purchase basis.

But in reality, he said such a scheme may be difficult to implement and the consumers will have to pay for the full cost of the new, replacement cylinders.

"The estimated cost of paying for the new cylinders runs into tens of millions of pesos. This will be hard on the pockets of the poor members society who will be required to comply with the law. That is the point of issue that we are contesting," he said.

Pimentel said he has met with various stakeholders of the industry, including members of the LPG Dealers Association and gathered inputs from them in an attempt to seek a reasonable compromise on the controversial bill.

"We are not against the bill which seeks to regulate the use of LPG so that accidents can be prevented. But we are certainly against any move that will unduly advance the interest of the major players at the expense of the small players in the LPG business," he said.

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