CNG stations in jeopardy due to restricted gas supply

KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed concerns over the ever-increasing and unsustainable losses to CNG stations in Sindh due to government policies, RLNG-linked CNG pricing regime, gas load shedding, and favouritism in supplying indigenous gas.

FPCCI President Mian Nasser Hyatt Maggo, while addressing media on Thursday expressed serious concerns when CNG associations’ leadership informed him that 70 to 80 favourite CNG stations of the authorities were still getting indigenous gas at Rs1,350/MMBTU, while the rest had to pay Rs2,040/MMBTU excluding tax. They called the practice discriminatory and unfair. FPCCI chief said that huge investments by CNG stations were in jeopardy as the stations were on the verge of closure. The economic sense, which was the very reason behind introducing CNG in the first place, was nullified with CNG stations in Sindh forced to sell CNG upwards at Rs150/kg to Rs165/kg.

Junaid Makda, convener FPCCI’s standing committee on LNG and natural resources, called the situation “an existential crisis”. He said that if the cost-effective and environment-friendly fuel became too expensive, it would result in the closure of CNG stations, thus rendering thousands unemployed.

“Sales tax had been increased from 5 percent to 17 percent on CNG stations, and has added extra burden on the profitability and sustainability of the sector,” he lamented.

Shabbir Sulemanjee of the CNG Dealers Association pointed out that they agreed to RLNG regime with the Sui Southern Gas Company (SSGC) on the promises that CNG stations would get uninterrupted gas supply, tax incentives, and reduced prices; “however, everything had been turned upside down and the exact opposite treatment had been meted out to the CNG stations”. Maggo extended his full support to the leaders of the CNG Dealers Association, and agreed to play a mediatory role from the platform of FPCCI to resolve all outstanding issues with the government authorities swiftly to reach a win-win mechanism on fair pricing and uninterrupted supply.