CNMI BILL WOULD LET UTILITY MARKET GASOLINE

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By Gemma Q. Cassas

SAIPAN, CNMI (Marianas Variety, Feb. 3) – In an apparent bid to break Mobil’s domination of gas prices in the Northern Marianas, a lawmaker will introduce a measure that would authorize the Commonwealth Utilities Corp. to sell to independent retail gas service dealers any surplus fuel that the corporation buys at a lower price.

Rep. Ray Yumul, Ind.-Saipan, said service stations currently get their fuel from Mobil and Shell at about US$3.00 per gallon.

Under the current arrangement with Mobil and Shell, Yumul said service dealers get a commission of 15 to 19 cents per gallon of the fuel they sell to the public.

Right now, Mobil sells diesel fuel to the Commonwealth Utilities Corp. at US$2.10.

Yumul said his bill would allow the corporation to sell surplus fuel, particularly motor fuel, to service stations at the same rate that it gets the product from Mobil.

According to the bill, the service stations will be charged an excise tax of 15 cents for every gallon they purchase from the Commonwealth Utilities Corp. but they will be allowed to retail it at a 25 percent profit cap from the original price.

Commonwealth Utilities Corp.’s fuel agreement with Mobil allows the agency to purchase more than 30 million gallons of fuel from the oil firm every 12 months, Yumul said.

But Commonwealth Utilities Corp. is not able to place a maximum order with Mobil since the agency doesn’t have a lot of working engines in its power plants.

Yumul said service dealers are interested in his proposal. "If this becomes a law, it will rock the boat and level the playing field," he added.

February 3, 2006

Marianas Variety: www.mvariety.com

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