CNG association, govt reach deal
15 June, 2012
ISLAMABAD: The Ministry of Petroleum and the All Pakistan CNG Association (APCNGA) have agreed to keep a difference of 40 percent between the prices of petrol and Compressed Natural Gas.
This was decided in a meeting of the APCNGA and the Petroleum Ministry on Thursday.
According to a written agreement, the ministry has concluded an arrangement with the CNG association on the following terms: (i) CNG retail price including Gas Infrastructure Development Cess (GIDC) will be fixed in such a manner that it will result in price at 60 percent of retail petrol price (ii) No additional GIDC will be levied over and above the agreed parity price differential agreed here. (iii) The load management of CNG will be reduced by eight hours with effect from June 16 – two full days and 16 hours (iv) The above parity will be maintained in pursuance of existing CNG price computation formula approved by Oil and Gas Regulatory Authority (OGRA) and (v) This agreement will be maintained for a year commencing June 16, 2012.
APCNGA Chairman Ghayas Paracha told a press conference that in accordance with the agreement, the government will reduce CNG prices on June 16. He said that CNG sector was consuming only 8% of the total available gas against claims of over 15%. He said that 322 million cubic feet per day (MMCFD) of gas was being consumed by the CNG sector, which is serving around four million vehicles across the country.
Paracha added that the CNG association has rejected government's proposal to bring CNG prices at par with those of petrol, because this would lead to the collapse of CNG sector and loss of billions of rupees in investment. "Petroleum Ministry has assured APCNGA that the agreement would be presented before the next meeting of the Economic Coordination Committee of the cabinet," Paracha revealed.