Pakistan LNG market likely to reach one bcfd in two years

ISLAMABAD: All Pakistan Compressed Natural Gas Association (APCNGA) on Tuesday hoped that the compressed natural gas (CNG) sector will fully revive with an increase in the import of liquefied natural gas (LNG) during the next two years.

"In 2012, around 3,200 CNG stations were shut down following a ban the supply of natural gas due to the shortage of the commodity, but now after May 26, 2016 around 2300 stations have restarted their operations – thanks to LNG," Ghiyas Abdullah Paracha, the leader of the association, told APP.

 “Now a number of private sector investors were taking keen interest in setting up LNG terminals and importing gas and it is hoped that in the next two years the LNG market will reach one billion cubic feet per day (bcfpd).” Currently, Pakistan State Oil is importing 600 mmcfd LNG andits volume would be doubled soon.

Paracha said the CNG stations were operating round-the-clock in a week and getting uninterrupted supply of gas.  

"Oil and Gas Regulatory Authority (OGRA) has given us a go-ahead to import lightweight CNG cylinders and latest Electronic Fuel Injection (EFI) compatible kits, but the ministry is dragging its feet on our request of 35 percent waiver on the import duty," he said.

Ghiyas added the duty was imposed to discourage the use of natural gas in vehicles. “With the import of liquefied natural gas (LNG), supply to all consumers has improved significantly, so there is no justification for the import duty," said the All Pakistan Compressed Natural Gas Association chief.

Paracha observed the duty free import of equipment would greatly help provide inexpensive and eco-friendly fuel to consumers.

“Arrangements to start import of new lightweight 22kg CNG cylinders and kits have been fianalised,” he said adding, “Two firms from Italy and Singapore have agreed to supply the equipment."

He further said that after the waiver, the new equipment would be affordable for all compressed natural gas-run vehicles. “It will offer around eight to ten percent more mileage, besides saving sufficient amount of money on monthly fuel expenses,” said he. The All Pakistan Compressed Natural Gas Association chairman said the new cylinders would have the same (8kg) capacity as of the old 60kg cylinders. 

“The new technology would be user-friendly, economical in terms of fuel consumption, and cost-effective,” he remarked. Replying to a question, he said the price of new equipment would be determined after its import. In 2012, he said, Pakistan was on top among compressed natural gas-user countries with 3.7 million compressed natural gas-run vehicles.

"Future will be of the inexpensive and environment-friendly fuel, which is almost 30 percent cheaper than the petrol at the existing rates. Currently, CNG stations are consuming 100 mmcfd gas and it will be increased to 250 mmcfd level soon," he remarked.