KARACHI, July 3: CNG dealers have started charging two rupees more per kg from Monday to Rs33 from Rs31 per kg from vehicle owners following an increase in gas rates by the Oil and Gas Regulatory Authority (Ogra) July 2, 2006.
According to CNG Station Owners Association of Pakistan (Csoap), the CNG rate has been revised due to increase in gas price by Rs23.63 Mmbtu to Rs264.54 from Rs240.91 per Mmbtu.
In January, 2006 the CNG station owners had enhanced the CNG price by Rs2-2.40 per kg depending on the area location from Rs29 per kg.
However, there is a difference of opinion on concept of saving in CNG while using in automobiles as compared to petrol. General Secretary Csoap Muhammad Abbas Sajid said that consumers using CNG in cars enjoyed 55 per cent saving in terms of money as compared to petrol.
To a query as to why the rush of cars has not decreased at the pumps, he said that the CNG stations were receiving eight pound per square inch (PSI) of pressure from Sui Southern Gas Company Limited (SSGCL) as against the demand of 15 PSI.
He said that Karachi had limited pumps providing CNG facility, which do not match the rising demand. He said it was hard to set up a CNG station owing to high price of land and red tape in the bureaucratic system.
In contrast to Csoap stance CNG Dealers Association chairman Abdul Sami Khan offered a different view, saying there was still a saving of 38 per cent in using CNG in cars as compared to petrol. The percentage of saving fluctuates with the increase in petrol and CNG rates, he added.
He said that the SSGCL demanded extra money from the station owners for bringing gas pressure to 15 PSI from 8 PSI as it says that it has to lay extra pipeline. The company, however, said that it would not charge extra money from some CNG stations (15 pc of the total) where pipeline facility was available.
Mr Sami claimed that more than 90 per cent pumps in Punjab received gas at 15 PSI pressure from Sui Northern Gas Pipeline Limited. However, he claimed, that some station owners, not members, were charging Rs34-35 per kg in Punjab after the gas price hike from Sunday.
Besides, he said the government last month had reduced the number of departments issuing NOC for setting up CNG stations to four from 16, which may encourage new investors to set up more stations. He added that the City government had granted permission for setting up CNG stations at 600 yards but it takes more than one year for the investor to get the permission.
While CNG is getting popular owing to saving benefit in terms of money – petrol consumption in the country has been on the decline. In July-May 2005-06, petrol intake plunged to 1.1 million tons as compared to 1.2 million tons in the same period of last fiscal.
Dispensers at many petrol pumps now receive less number of cars as a sizable number of vehicles have been converted into CNG. Only motorcycle owners are seen in big rush at the pumps as number of bikes sold in 2005-06 stood at around 700,000 units. Three years back, total bike sales were only 100,000 units, thanks to the entry of the Chinese bikes into the market, which are cheaper by Rs19,000--20,000 as compared to Honda CDI 70cc of Rs54,000.
According to Economic Survey 2005-06, some 930 CNG stations (as on May 2006) are operational in the country, while 200 are under construction. By the end of April 2006, about one million vehicles had been converted into CNG as against 700,000 units converted during the last year, up by 43 per cent.
The Survey says that an investment of Rs20 billion had been made in the CNG sector and Rs2 billion are in pipeline. The CNG industry has created 20,000 jobs. Pakistan has become the leading country in Asia and the third largest user of CNG in the world after Argentina and Brazil.Because of big saving in terms of consumption and money, only few per cent people are booking the locally assembled petrol version cars. An executive in Pak Suzuki Motor Company Limited (PSMCL) said that the company was receiving 90 per cent booking of CNG cars compared to 70 per cent last year and 60 per cent two years back.
Even the passionate buyers of used imported cars are eager to install CNG kits in their vehicles since petrol prices have jacked up phenomenally in the last few years. On June 30, 2001, petrol was available at Rs33.81 as compared to Rs57.70 per litre now, showing a rise of 70 per cent.
