1999News

More government charges of Mundogas contract violations

The news daily Listin Diario reports that a government document it has acquired shows a longer list of government charges of contract violations against Mundogas than has been previously aired. According to Listin, the government document lists several violations, including: (1) noncompliance with Law 520 requiring liquefied petroleum gas (LPG) being marketed to have a chemical composition of over 70% butane; (2) noncompliance since June 1996 with contract provisions calling for proper maintenance and function of LPG installations; (3) noncompliance with contract requirements that Mundogas supply the gas tanks for kitchen stoves it supplies; (4) nonpayment of outstanding debt; (5) noncompliance with a contractual obligation to maintain a "strategic reserve" to tap during LPG supply shortages. Previously the Industry and Commerce Ministry has principally complained that Mundogas was not meeting its 40% LPG market quota and it lacked the necessary financial liquidity to maintain smooth operations.