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Govt dealing with illegal petrol imports

New requirements for companies seeking to import petroleum to Laos are being reviewed or devised after the government made a decision last month to reduce the number of fuel companies from 22 to five.

Those which fail to meet the new requirements will have to halt or be encouraged to turn to other businesses, according to the Lao Petroleum and Gas Association on Tuesday.

A senior official from the association, Mr Phayboun Phomphaphi, who is also Deputy Director of Lao State Fuel Enterprise told Vientiane Times recently that the adjustment of the fuel companies is necessary to make it easier for management.

Mr Phayboun said currently many fuel companies are too small and might not meet standard requirements so it was necessary to adjust the figure downwards.

“Over the past years, illegal imports of oil have been reported in Laos and I believe that the adjustment and improvements will contribute to address the problem,” he said.

Four state petrol companies could be adjusted down to one or two; nevertheless more studies are needed to identify the possibility of the adjustment. However it was not very clear exactly when the adjustment of the fuel companies will take place.

Last month, the government announced that three companies would no longer be able to transport imported fuel through Laos to third countries. The government also announced that 22 companies that are currently importing petroleum would be reduced to only five in the near future.

The move aims to plug loopholes that could result in illegally imported fuel, according to Deputy Minister of Finance, Mr Bounchom Ubonpaseuth.

Mr Bounchom said only companies that comply with the country's laws and government's obligations will be permitted to continue to operate.

The announcement was made at the government's monthly meeting held in Vientiane from January 24-25, which was chaired by Prime Minister Thongloun Sisoulith.

According to a government report, petrol must only be imported across officially recognised international border crossings. Fuel must not be brought into the country at local border crossings.

According to the Lao Petroleum and Gas Association, petrol imports to Laos increased by eight percent annually. However the association has yet to conclude the oil import figures for 2016.

In 2013, Laos imported about 1,000 million litres of fuel and the association assumed that the figure for 2016 should be about 1,300 or 1,400 million litres of oil for last year.

The demand for fuel is on the rise in Laos due to the continued growth of the Lao economy, particularly in the industrial sector. This growth is also translating to a rising number of vehicles on the roads. Some 45 to 50 percent of the fuel Laos imports is used in Vientiane and Vientiane province.



By Somsack Pongkhao
(Latest Update
February 24,

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