ISLAMABAD, July 8: Pakistani efforts to promote the use of cheap compressed natural gas (CNG) in vehicles are bearing fruit and the industry could be worth up to $400 million in the next three years, an energy official said on Friday.

About 750,000 petrol-run vehicles have been converted to CNG and the government planned to substitute diesel oil with natural gas in near future, said Hilal A. Raza, director-general of state-run Hydrocarbon Development Institute of Pakistan.

“CNG is a success story for Pakistan ... this programme could have an easy outlay of $300 to $400 million in the next three years,” Mr Raza told Reuters in an interview.

Pakistani drivers consumed around 15.8 billion cubic feet of CNG during the calendar year 2004, which was equivalent to 3.7 million barrels of petrol.

CNG use in Pakistan has been growing at a rate of about 50 per cent a year over the past five years, analysts say.

“It’s the cost factor which is driving aggressive use of CNG in Pakistan, as it is one fourth in price compared with the motor gas,” said Asif Qureshi, head of research at Invisor Securities.

“CNG usage has cut the oil import bill by around $235m,” he added. Pakistan imported crude worth of $3 billion during the first 10 months of last fiscal year.

Pakistan’s CNG is produced from domestic gas supplies.

Pakistan’s CNG programme was launched as a pilot project in 1982 with one CNG filling station in Karachi run by Mr Raza’s institute, catering to a small number of vehicles.—Reuters