Alert Sign Dear reader, online ads enable us to deliver the journalism you value. Please support us by taking a moment to turn off Adblock on

Alert Sign Dear reader, please upgrade to the latest version of IE to have a better reading experience


CNG sector seeks weekly billing

September 11, 2012


ISLAMABAD, Sept 10: The CNG sector has demanded gas utility companies SSGC and SNGPL to bill them on a weekly basis following the change in pricing formula for petroleum products.

The CNG sector claims they would face huge losses if they are billed at the average price for the month.

“The sales are not the same for every week – we can have more sales when the prices are less,” said Ghiyas Paracha, Chairman All Pakistan CNG Association (APCNGA).

“The government has done one illegal act by making adjustments in the sale price without following the due procedures and the gas companies are taking advantage of the situation.”

Under the regulations, the gas prices for various consumers including the Compressed Natural Gas (CNG) are determined by the Oil and gas Regulatory Authority (Ogra) bi-annually after public hearing and a petition is filed by the SNGPL and SSGC in this regard.

However, the petroleum ministry in a breach of regulation have recently resorted to making adjustments in the gas sale prices after reaching the upper limit of Gas Infrastructure Development Cess.

Imposed in the current federal budget, the Cess for CNG is similar to the petroleum levy for the oil products and it has been set at Rs263 per mmbtu for the Region I and Rs200 per mmbut for the region–II.

The region–I for the CNG includes Khyber Pakhtunkhwa, Baluchistan and the Potohar Region which is Rawalpindi, Islamabad & Gujarkhan, while the Region –II covers Sindh and Southern and central Punjab.

Meanwhile an official of the petroleum ministry said that the price of CNG was being revised according to the price of petrol as it has to be at 60 per cent of the price of petrol.

“The CNG prices are fluctuating due to this 60 per cent price parity — since the Cess has reached its upper limit, the option to maintain this parity is through increasing the cost price.”

The price of gas determined by OGRA for the CNG sector was Rs618 per million British thermal units (mmbtu) for the period July 1, 2012 to December 31, 2012, but currently it has reached Rs684.09 per mmbtu.

“But the gas price for us in the fist week of September was Rs744 per mmbut,” Mr Paracha said, adding that this way if more sales are registered in the ongoing week, then CNG filing stations will be paying an additional amount to the SNGPL and the SSGC due to high average price.

Another member of the APCNGA said that it is expected that the SNGPL will be bagging between Rs50,000 and Rs100,000 per month from the CNG stations through billing on a monthly average price.

He said SNGPL and SSGC, despite the clear government orders, did not change their system accordingly and have held millions of rupees with out any proper accountancy from CNG stations.

However in response to the letter by the CNG sector, SNGPL has expressed its inability to the bill them on weekly basis as they said it is beyond their capacity.