Hefty fine for overpricing of LP Gas

This comes after media reports emerged that some retailers are overcharging the public on the price of LP Gas, which is capped. Last July, Minister Dipuo Peters approved the setting of maximum retail prices for LP Gas supplied to residential consumers. This gas price is adjusted on the first Wednesday of each month along with petrol, diesel and illuminating paraffin.

"Following the recent media reports about some retailers who are overcharging consumers on the price of LP Gas countrywide, the Department of Energy wishes to express concerns over this kind of behaviour that contravenes the Petroleum Products Act, 1977 (Act No. 120 of 1977) as per amended," said the department.

LP Gas prices differ from one Magisterial District Zone (MDZ) to another due to the use of different transport tariffs that are applicable to each zone.

The department emphasised that the regulation of the maximum retail prices for LP Gas that is sold to residential consumers is regulated in terms of the Petroleum Products Act and violation amounts to contravention of the Act.

Anyone contravening the Act faces a fine "not exceeding R1 million or imprisonment for a period not exceeding 10 years, or both such fine and such imprisonment."

As of Wednesday, 6 July 2011, the maximum retail price for LP Gas decreased by 42 cents per kilogram.

The department urged consumers who have complaints about being overpriced to contact regional inspectors in their respective provinces.

Meanwhile, PetroSA is set to increase the production of LP Gas to help alleviate a shortage.

The state-owned company said it will convert a percentage of its Mogas molecules to LP Gas in order to help alleviate the country's acute LP Gas shortage.

PetroSA board chairman, Dr Benny Mokaba, said the decision was made because the LP Gas shortage affected both the motor industry and "the country's poorest" during the recent cold spell.

The decision will result in the company reducing its propane and Mogas production by about 1500 cubes and 2000 cubes respectively and in the process, increasing LP Gas production by about 3000 cubes.

"In a country such as ours, PetroSA's reason for existence is vital. We exist in order to ensure security of supply when market forces fail for whatever reason. It is our fervent hope that our efforts will go a long way towards easing the situation and warming South Africans in these chilly days," Mokaba said.