The Dominican Republic is not at risk of LPG shortage
The Dominican Petroleum Refinery (Refidomsa) guaranteed that the country is not at risk of Liquefied Petroleum Gas (LPG) shortage and informed that it received the most recent shipment from the company Geogas as scheduled.
In a press document, the state-owned company highlighted that it maintains a commercial relationship with Geogas through which the latter supplies LPG, under a contract since 2019.
The document indicates that the contract guarantees minimum monthly deliveries of LPG to Refidomsa, with Geogas being responsible for the environmental permits required for the operations of its vessels.
From 2021, Geogas notified a change in its logistics to supply Refidomsa from its storage tanks in San Pedro de Macoris.
The Dominican Petroleum Refinery (Refidomsa), has a share in the LPG market in the country of approximately 36%, so, under the current circumstances, a shortage that could harm the country is not possible, given the participation of other companies in the market and the existing supply infrastructure.
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In 2019 Refidomsa started the construction of new tanks to raise LPG storage capacity to 20,000 tons, as it is currently only 5,000.
This situation prevents the entry of large vessels that supply the product, but small ships that increase the cost of docking and affect the final price.
To finance the work, Geogas signed a contract for US$61 million, which advanced US$11 million; however, the current management of Refidomsa allegedly decided not to use the financing, which was paid with estimated savings at US$20.00 per ton.
It was reported that Refidomsa, after refusing to certify the documents to Banreservas to complete the financing, requested a loan for the same amount and left that part of the Geo Gas contract without effect indebting the company.