ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) has completed random cost audit of 11 CNG stations across the country as per directives of the apex court to determine fair production cost of compact natural gas.

Production cost samples were collected randomly from two private stations operating in each province, one in the federal capital and two stations operated by the oil marketing companies.

The cost audit of these CNG stations is expected to be completed by Nov 14 and is scheduled to be presented in Supreme Court on Nov 19.

“The cost accounting samples have been taken by Ogra to assess the average production cost faced by the sector,” said an Ogra official.

The All-Pakistan CNG Association CNG sector has also filed an application with Ogra expressing its concern over cost audit mechanism adopted by Ogra.

The Gas Infrastructure Development Cess (GIDC) and the GST are not included in the cost of gas but are billed to CNG stations, said the association.

The letter also said that production cost samples do not include other operational costs, including cost of using generators during electricity load-shedding hours and extra use of compressors during low pressure of gas.

The other expenses include Ogra third-party annual inspection fee, annual testing of equipment, local government charges, explosive department fee, labour department fees and the 10-20 per cent of gross sales as franchise fee to oil companies for CNG stations established at petrol stations, the letter added.

The association also sought cut in taxes and surcharges collected at the CNG instead of making their cost of production in the negative zone.

Currently CNG rates in Region I (KPK, Balochistan and northern Punjab --Rawalpindi, Islamabad and Gujarkhan) is Rs61.64.

However, the association pointed out that the cost of gas for region –I is Rs19.52 per kg, whereas government taxes and cess includes Rs35.82 per kg.