Small LPG wholesalers get leg up
Competition Commission will also include evidence of collusion in setting cylinder deposit fees in ongoing cartel investigations
The Competition Commission has recommended small wholesalers of liquid petroleum gas (LPG) must be given preferential access to 10% of the market and contracts between refiners and wholesalers may not exceed 10 years. The commission released its final report into the LPG market on Monday after a three-year investigation prompted by concerns about limited local supply of LPG and possible anticompetitive practices. A year ago it released a preliminary report for public comment. The gas is sold to households and businesses. The commission said it found evidence of collusion in setting cylinder deposit fees and this would form part of its ongoing cartel investigations. SA only has five LPG refineries: Sapref, Enref, Sasol, PetroSA and Chevref. Four wholesalers — Afrox, Easigas, Oryx Energies and TotalGaz — account for 90% of the market. Some of the contracts between refineries and wholesalers have been in effect for 25 years. There are high barriers for new entrants, including capital c...
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