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CNG strike More trouble in the offing

June 09, 2012

ISLAMABAD, June 9: As the indefinite strike by CNG dealers created trouble for the commuters, many petrol pumps in the twin cities also started going dry as oil companies seemed unable to meet the rising demand.

The situation is no different in some other cities of Punjab and Khyber Pakhtunkhwa where panic buying is also adding to the problem.

“Our normal sale is between 10,000 and 12,000 litres a day and it reaches the mark of 15,000 litres on Saturdays, the third day of CNG loadshedding in the Potohar region,” said Abid Hayat, the owner of a petrol pump near I-9 police station. “However, the sale surged to 32,000 litres by Friday night,” he added.

He said the consumers had a reason to worry, as there was no sign of relief soon.

While the government and the striking All Pakistan CNG Association seemed not ready to resolve the issue through talks, two coalition partners of the federal government - PML-Q and MQM - supported the CNG dealers.

The MQM also voiced concerns over the massive cess on the CNG sector. In a press conference, MQM’s deputy parliamentary leader in the National Assembly Haider Abbas Rizvi said the government should not increase the cess. PML-Q leader Chaudhry Shujaat Hussain also supported the demand of the CNG association.

It may be noted that as the government has enhanced the Gas Infrastructure Development Cess in the Finance Bill 2012, the price of CNG would be Rs98 per kilogramme in northern Punjab, including the twin cities of Rawalpindi and Islamabad.

The Finance Bill 2012 suggested the cess on CNG to be Rs300 per mmbtu in Khyber Pakhtunkhwa, Balochistan and the Potohar region, while for the Region-II, which includes Sindh, southern and central Punjab, it would be Rs200 per mmbtu.

The situation is going to further worsen because All Pakistan Oil Tankers Owners Association has also extended its support to the CNG association and announced its decision to go on a strike for an indefinite period from Monday if the government does not accept the demand of the APCNGA.

“We support the demand of CNG people as increase in cess would result in an exorbitant hike in the CNG rates and ultimately will also hit us too,” said the chairman of the association, Mir Mohammad Yousuf Shahwani.

Meanwhile, in a statement, Chairman APCNGA Ghyas Paracha said the government planned to destroy the CNG sector in order to promote the use of LPG (liquefied petroleum gas) as it had lucrative profits from import.

He said though the consumption by IPPs and the industry was more than 51 per cent of the total gas produced in the country, only Rs100 per mmbtu cess had been imposed on them.

Besides, their tariff is also at the minimum.

“The CNG sector is consuming just 7.11 per cent of the total production and paying the highest tariff, but Rs300 per mmbtu cess has been imposed on us,” Mr Paracha complained.

As the strike continued, the oil marketing companies remained busy in meeting the enhanced petrol demand, which surged by around 40 per cent in four days.

“The average daily petrol demand is around 7,000 to 8,000 tons but it has crossed the mark of 10,000 tons now,” said an official of Pakistan State Oil (PSO). He added: “A special tender for purchase of 35,000 tons has been floated on Saturday which is likely to be materialised in 10 days.”

However, the situation could be serious across Punjab and KP if any of the strings in the delicate supply chain is hit like delay in import or if the petroleum ministry fails to convince the oil tankers not to join the strike.