LPG CYLINDER COST



LPG cylinder in India, courtesy - Indian Oil
What is in the LPG Cylinder  ?

         When crude Petroleum is drilled out from deep inside the earth, it comes out with a gush and is accompanied with huge amount of gases. This gas is loosely known as petroleum gas.
         This gas is filtered to remove the liquid petroleum accompanying it.
         A strong smelling chemical is added to it – so that you can identify if the LPG cylinder is leaking.
        Finally the gas is compressed to a liquid state and filled in cylinders.
        When the gas is used from the cylinder, the liquefied gas becomes gaseous again, and comes out under pressure.
       The liquefaction is done so that the cylinder can accommodate more gas.

Is any manufacturing process involved ?

       Providing the customer with a LPG cylinder involves only filling the cylinder with a gas which is coming out as a waste-product of oil drilling.
      The gas is not manufactured, or you can say that no manufacturing is involved.
      It is the same as digging out coal and supplying it to the consumer or collecting river sand and supplying it for building construction work.

What if the gas were not to be used ?

Gas being flared at an oil head, courtesy - NYT
       Every year, the oil industry burns off up to 170 billion cubic meters of natural gas released in the oil extraction process, according to a new report commissioned by the World Bank. The practice, known as gas flaring, not only harms the environment by emitting some 400 million tons of carbon dioxide globally, but is also wasteful of a cleaner energy source, notes Bent Svensson, manager of the Bank’s Global Gas Flaring Reduction partnership.  


Gas being flared at an offshore oil rig, courtesy - researchgate
Is there a shortage of this gas ?


       Huge amounts of this gas are “flared” i.e. burned off since it could not be used.

Gas supply is in excess of what is being used.

      Amount used in LPG cylinders is a fraction of what is available.


What other uses it could be put to ?

    Rather than simply burning it off, economists support exploiting the resource by converting it to LPG, transporting it via pipelines as industrial fuel, or to generate electricity.

Cost of the kitchen LPG cylinder ?

      The cost involved is only of bottling, and transporting the cylinder. There is no shortage of gas.
       In the seventies and eighties the shortage in India used to be of the steel cylinders, as there were only one or two manufacturers in India, and the cylinders had to be imported. Now there are several manufacturers and there is no shortage of cylinders.
      The cost of the cylinder is taken from the consumer when giving a new connection. So the cost of a refill is only the cost of the gas.

      As is clear from the above – LPG involves no manufacturing, only bottling and transportation All exploration & production costs of petroleum are built into the cost of Petrol & Diesel and its bye products – kerosene / wax / petroleum jelly / bitumen etc..


THEN WHAT IS THE SUBSIDY BEING CLAIMED FOR BY THE OIL COMPANIES ?

Also since there is no shortage of gas – WHAT WAS THE ISSUE OF PROPOSING A LIMIT TO  THE USAGE TO FEW CYLINDERS A YEAR ?

DO NOT BE MISLED BY the PROPAGANDA of Oil companies… BE INFORMED and KEEP OTHERS INFORMED


Comments

  1. Ratan M Lal24 June 2020 at 01:36

    Yes this is a valid point

    ReplyDelete
  2. Mat Rad24 June 2020 at 06:02

    There is some amount of processing involved in LPG "manufacturing". Liquefied Petroleum Gas (LPG) is produced by stripping it from the raw natural gas stream during natural gas processing and during crude refinery process. The gas (which consists of Propane and Butane, with small amounts of other natural gas liquids) is then liquefied under modest pressure.

    It has to be transported via field pipelines initially to storage tanks and then to bottling plants or distributed through household pipelines.

    The expenses add up!

    ReplyDelete

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