gas | distribution - lpg · • in pakistan, total 168 companies have license for lpg marketing by...
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GAS | DISTRIBUTION
- LPG
SECTOR OVERVIEW
March 2019
SECTOR | CONTENTS OUTLINE
❑ Energy supply chain | chunk secured by LPG
❑ LPG – Supply Sources
❑ LPG Production (Last five year’s trend and last six months)
❑ LPG Imports (top players in last six months)
❑ LPG Consumption | Sectors & Provinces
❑ LPG Marketing Companies – Fragmented industry
❑ LPG – Pricing Mechanism (regulated by OGRA)
PAKISTAN | PRIMARY ENERGY SUPPLY CHAIN
Primary Energy Supply
Oil 34.4%
LPG
1.3%
LNG import
5.6%
Gas
37.9%
• Pakistan’s energy supply consist of
various sources
• Oil and Indigenous gas secure
major chunks by fulfilling 34.4%
and 37.9% of the country’s energy
needs
• Other sources include Coal 8.1%,
Hydroelectricity 9.7%, Nuclear
electricity 2.1% etc.
• Imported LNG fulfills 5.6% of the
country’s energy needs
• For year 2016-17, LPG secured
1.3% of the country’s needs
Source: Pakistan Energy Yearbook 2017
PAKISTAN | LPG | SUPPLY BY SOURCE
Year 2012-13 2013-14 2014-15 2015-16 2016-17
Refineries 205,262 205,963 191,664 174,413 178,333
Field Plants 218,031 264,629 276,891 467,077 488,874
Imports 68,408 71,093 145,634 372,850 461,426
Total 491,701 541,685 614,189 1,014,340 1,128,633
Growth 5.43% 10.2% 13.4% 65.2% 11.3%
• Three sources of LPG – supply from field plants and imports augmented over the
years
• Sizable surge witnessed in 2015-16 in supply from field plants is due to addition of
10 new field plants. Furthermore, JJVL’s production increased manifolds.
• However, in CY18 JJVL’s production is almost none due to closure of major
operations on account of technical issues on field.
Source: Pakistan Energy Yearbook 2017
PAKISTAN | LPG | PRODUCTION
Sr.
#
Players 2HCY18
1. OGDCL 135,399
2. MOL 84,764
3. PARCO 63,768
4. PPL 47,711
5. BYCO 34,205
6. UEPL 11,583
7. POL 8,419
8. PRL 6,632
9. NRL 4,174
10. ARL 1,520
11. OPL 1,323
12. JJVL -
Total 399,499
• During 6MCY18, Pakistan produced 399,499
MT of LPG (top players only)
• Top LPG producing player was OGDCL (share:
~34%)
• MOL and PARCO had respective share of 21%
and 16%
Source: OGRA Website, LPG department, Production data
12%
34%
16%
21%
2%
0%
2%
3%
0%
0% 1% 9%
PPL
OGDCL
PARCO
MOL
POL
OPL
PRL
UEPL
ARL
JJVL
PAKISTAN | LPG | MAJOR IMPORTS
Sr. Players 2HCY18
1. Pyramid Gas 39,256
2. Hazara LPG 23,545
3. Ayan Energy 19,482
4. Alliance Energy 15,765
5. Havelet Gas 15,687
6. Burshane 5,470
Sub - Total 119,204
Total 126,819
• During 6MCY18, total 23 LPG companies
imported LPG which amounted to 126,819 MT
• Out of which major six players imported
119,204 MT; remaining players secured lesser
chunk
• Pyramid Gas secured 31% share out of total
imported quantity
Source: OGRA Website, LPG department, imported data
31%
15%5%
19%
12%
12%
Pyramid Gas
Ayan Energy
Burshane LPG
Hazara LPG
Havelet Gas
Alliance Energy
PAKISTAN | LPG | CONSUMPTION BY SECTOR
Source: Pakistan Energy Yearbook 2017
488,416541,233
699,153
1,118,790
1,209,420
2012-13 2013-14 2014-15 2015-16 2016-17
Domestic Commercial Others Total
• Pakistan’s LPG consumption increased by 8% in FY 2016-17
• Growth was mainly lead by ‘Other’ as it witnessed ~18% uptick in FY 2016-17 as LPG is
sold in cylinders; easily to use and transport
• Domestic and commercial sector’s growth clocked in at ~6% and 4% respectively
LPG | CONSUMPTION BY PROVINCES
For the year 2016-17 MT
Sr.# Province/ Region Domestic Commercial Industrial
1. Punjab 54.6% 72.9% 82.7%
2. Sindh 4.1% 10.0% 8.2%
3. KPK 14.9% 3.3% 3.3%
4. Baluchistan 2.1% 1.9% 3.9%
5. AJ Kashmir 8.1% 4.9% 0.2%
6. FATA 4.6% 2.1% 0%
7. Northern Area 9.9% 2.9% 0.5%
8. Federal Area 1.7% 1.9% 1.1%
Total 100% 100% 100%
• Majority domestic
consumption lies
with Punjab
Province – most
populous province
• LPG is being used
in industries like
textile, ceramic
industry, steel and
furnace, power
generation
companies, glass
industry, edible oil
industry, beverage
industry and
chemical industry
Source: Pakistan Energy Yearbook 2017
LPG | CONSUMPTION BY PROVINCES
For the month Mar-18 MT
Sr.
#
Province/
Region
Domestic Commercial Industrial
1. Punjab 50.9% 68.5% 72.4%
2. Sindh 5.9% 11.3% 13.1%
3. KPK 14.2% 5.5% 4.8%
4. Baluchistan 2.4% 2.7% 8.6%
5. AJ Kashmir 8.0% 4.8% 0.3%
6. FATA 6.6% 2.5% 0%
7. Northern
Area
10.7% 3.6% 0%
8. Federal Area 1.2% 1.3% 0.8%
Total 100% 100% 100%
Source: Pakistan Energy Yearbook 2017
• LPG consumption
by provinces for the
month of Mar-18
remained largely
same with earlier
composition
• Majority
consumption secured
by Punjab province
in all three areas
Domestic,
commercial and
industrial.
• Majority offices of
LPG marketing
companies are
located in punjab
PAKISTAN | LPG MARKETING COMPANIES
• In Pakistan, total 168 companies have license for LPG marketing by OGRA. Hence, it’s
a highly fragmented industry with players having diluted market shares.
• LPG marketing companies have specific brand names – specified with the license
• Each LPG marketing company has several ‘Authorized Distributors’ – authorized by
OGRA to sell on behalf of the company. Total number of distributors is around 5,000 for
the industry.
• 51 companies have head offices located in Lahore while 43 are located in Islamabad;
Karachi has 17 LPG Marketing Companies’ head office while 6 are located in Quetta
• All of these players have several zonal offices, sale points and warehouses – this
facilitates end consumers as this gas is easily available in cylinders
• Cylinders comes in various sizes: 6KG, 11.8KG, 45KG, 200KG (may vary from player
to player); some players sale and transport in bulk (through tanks)
Source: OGRA Website/ LPG Department
PAKISTAN | LPG | PRICING MECHANISM
• OGRA, after letter by Ministry of Energy (petroleum division) started notifying price of
indigenous LPG, maximum producer price, margins of marketing / distribution companies
and consumer price since February 2018. However, producers, marketing companies and
distributors may sell below the maximum price determined from time to time.
• Producer’s price includes excise duty of PKR 85/M.Ton. Upon it, marketing/ distribution
margin, petroleum levy and GST are topped up.
Source: OGRA Website/ Prices/ LPG prices
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
PKR
per M
T
DISCLAIMERPACRA has used due care in preparation of this document. Our information has been obtained from sources
we consider to be reliable but its accuracy or completeness is not guaranteed. The information in this
document may be copied or otherwise reproduced, in whole or in part, provided the source is duly
acknowledged. The presentation should not be relied upon as professional advice.
Analysts Jhangeer Hanif
Unit Head | Ratings
jhangeer@pacra.com
Sehar Fatima
Supervisory Senior | Ratings
Sehar.Fatima@pacra.com
Contact Number: +92 4235869504
Bibliography
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