‘Phasing out CNG will have associated costs’

APCNGA says investment and years of effort put at stake to benefit a few.

Our Correspondent July 31, 2012

ISLAMABAD: Pakistan is phasing out the CNG sector gradually at a time when the world is prioritising CNG fuel for vehicles as it is safer and environment friendly, said All Pakistan CNG Association (APCNGA) Central Chairman Ghiyas Abdullah Paracha.

APCNGA expressed dismay over the government’s plan to phase out the CNG sector from Pakistan in a statement issued on Tuesday.

Korea, Indonesia and Malaysia have replaced LPG by CNG due to safety concerns, said Paracha. “This is to avoid pollution in the cities. The world knows that only a healthy nation can build a country, but we have reverse-geared our policy,” he observed.

The Oil and Gas Regulatory Authority (Ogra) a month ago decided to give permission to Pakistan State Oil for setting up 26 liquefied petroleum gas (LPG) filling stations at its retail outlets across the country. Overall, the government is targeting to set up 100 LPG stations at retail outlets of PSO, in a bid to gradually phase out CNG stations over the next two years. As an another example, he pointed to the Indian government, and said it had announced provision of CNG to vehicles on top priority, then to small industries for processing purposes, and the rest to industrial units.

Pakistan is the largest user of CNG in the world, overtaking Iran, Argentina and Brazil in the number of vehicles using gas as fuel, according to the Economic Survey 2010-11. 2.74 million vehicles run on CNG fuel in Pakistan – almost two-thirds of all cars and small commercial vehicles plying the roads – according to the International Association for Natural Gas Vehicles. The country also holds the record for the most number of CNG stations.

Paracha said that if the CNG sector is shut down, its effects will be most pronounced on the health budget, foreign reserves and the import bill. He termed the possibility “lethal for the economy”.

Published in The Express Tribune, August 1st, 2012.