MUSCAT, AUGUST 31
MUSCAT: National Gas Company SAOG (NGC), one of Oman’s leading liquefied petroleum gas (LPG) bottlers, has made fresh representations to the government seeking a revision of the regulated pricing framework for LPG cylinders, citing mounting input and operating costs that are squeezing margins in its domestic business.
The publicly traded company is also awaiting regulatory clarity on a proposed industry-wide initiative to introduce colour-coded branding of LPG cylinders, aimed at distinguishing the products of individual bottlers and improving accountability and safety across the market.
Dr Rachid Majjad, CEO of National Gas Company, said the company resubmitted its request for a price revision to the Ministry of Commerce, Industry and Investment Promotion in early July 2026, reviving discussions with the ministry’s new leadership.
“We met them together with two of our Board members to convey the message that the price revision in Oman is really important under the current conditions,” Dr Majjad told shareholders and investors during NGC’s earnings call covering its first-half 2026 performance.
At the heart of NGC’s representations is a regulated rate of OMR 1.9 applicable to its standard 22-kg LPG cylinder business, which management says has remained unchanged since 1994.
The figure - which is distinct from the final retail price paid by consumers for a filled cylinder - relates to the regulated pricing applicable to the bottler’s part of the LPG supply chain. The framework has its roots in regulations introduced in 1994 governing the sale, maintenance and replacement of LPG cylinders in Oman.
According to Dr Majjad, the prolonged pricing freeze has become increasingly challenging as the company’s LPG purchase price alone has risen by around 50 per cent, alongside increases in payroll, transportation, taxation and other operating costs.
NGC has long sought a review of the pricing regime. As far back as 2014, the company was highlighting the growing pressure that higher LPG procurement and operating costs, coupled with unchanged cylinder pricing, were placing on the economics of its Oman business.
As an interim measure, NGC has been withdrawing discounts traditionally extended to traders and distributors. The practice, used competitively in the industry for around two decades, effectively meant selling below the regulated rate. NGC began eliminating these discounts in selected areas in January 2026, with Muscat following from September 1.
Separately, NGC is awaiting government guidance on plans to introduce distinctive colour branding for cylinders marketed by individual LPG companies. The initiative has been under discussion for around two years and is expected to bring greater differentiation and discipline to what is currently largely a colour-neutral market.
Under the proposed arrangement, each LPG company would have its own cylinder colour. NGC plans to adopt yellow cylinders carrying its “MiraGas” brand, already used by the company in Malaysia.
The initiative would potentially go beyond cosmetic branding. Dr Majjad said NGC also envisages replacing existing cylinder valves with self-closing valves conforming to international safety standards.
The company has assessed the cost of implementing the changes and submitted its estimates to the ministry. However, questions remain over how the transition will be funded, including whether the additional cost would ultimately be borne by consumers or supported through some form of government assistance.
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