ISLAMABAD Jamshoro Joint Venture Limited (JJVL) is said to have violated agreement signed with Sui Southern Gas Company Limited (SSGCL) which binds it to follow the highest reference price of main Liquefied Petroleum Gas (LPG) producers which is not only depriving SSGCL from major portion of royalty but also manipulating the market. Documents available with TheNation reveal that royalty shall be calculated with reference to Reference Price. The highest ex-plant and ex-refinery price in Pakistan for LPG during a month of one of the producers identified in Schedule-9 as Oil and Gas Development Corporation (OGDC); National Refinery Limited (NRL), Pakistan Refinery Limited (PRL) and Pak-Arab Refinery Company (PARCO), hereto will be used as the Reference Price for calculation of royalty for such month subject to a minimum price of US $ 250 per metric ton. Irfan Khokar, Chairman LPG Distribution Association Pakistan informed that as JJVL started production, it has successfully grabbed more than 3 billion rupees from 2005 till date with regards to LPG ex-plant and ex-refinery price. He further informed that JJVL is continuously breaching the signed agreement in context with LPG ex-plant and ex-refinery price as for example during the month of June 2010, JJVLs LPG ex-plant price was Rs 46,498.6 including tax but the OGDCs LPG ex-plant price was Rs 50,445 and PARCOs LPG ex-plant price was Rs 56640. Similarly, in the current month of July 2010, JJVLs LPG ex-plant price is Rs 52372 but OGDCs LPG ex-plant price is Rs 49683.48 and PARCOs LPG ex-plant price is Rs 56640 that is also more than JJVLs LPG ex-plant price. But no one is taking notice of JJVLs corruption that is also causing billions of loss not only to SSGCL but also to national exchequer by disobeying the LPG Extraction Project Agreement. It is pertinent to mention here that agreement of royalty will be calculated as a fixed amount of US $ 0.035 (the minimum royalty) per Million British Thermal Unit (MMBT) shall be paid to the Owner (Sui Southern Gas Company Limited) for gas made available to the plant if the Reference Price is between US $ 0 and US $ 250 per metric ton. More royalty will be calculated as for every one US dollar increase in Reference Price above US $ 250 per metric ton, royalty will increase by US $ 0.00095 per MMBTU over and above the minimum royalty. Similarly, royalty will be calculated for every one US $ increase in the Reference Price above US $ 300 per metric ton, royalty will increase by US $ 0.001126 per MMBTU over and above the minimum royalty. Likewise, royalty will be calculated for every one US dollar increase in the Reference Price above US $ 350 per metric ton, royalty will increase by US $ 0.001316 per MMBTU over and above the minimum royalty. Besides all this, it clearly indicates that this agreement of LPG Extraction Project at its Liquid Handling Facility Jamshoro and Hyderabad (Sindh, Pakistan) on Build Own and Operate basis was made on August 12, 2003 between Sui Southern Gas Company Limited (SSGCL) and Jamshoro Joint Venture Limited (JJVL) was signed only to benefit JJVL. More surprising clauses were introduced in the agreement simply to benifit the Jamshoro Joint Venture Limited (JJVL). According to the documents, this agreement shall commence and be effective on the date hereof, and, shall, unless terminated earlier in accordance with its terms continue, in full force and effect until the validity of Gas Sales Agreement (GSA), which is currently valid up to the 3rd of February 2011. It is agreed that the agreement shall continue on the same terms and conditions for any extension of the GSA beyond 3rd of February 2011.