LAHORE – The government has made up its mind for the closure of all CNG stations within next three to four years and decided not to renew the licence of filling outlets those completed 15 years period of operation.

Oil and Gas Regulation Authority (OGRA) had granted licences to filling stations for the period of 15 years with provision of a five-year extension. “Petroleum Ministry stopped OGRA from granting extension in CNG licences of operational filling stations on their expiry,” said an official of the ministry. 

All Pakistan CNG Association, however, sees ‘U-turn’ in the government policy under the influence ‘powerful mafia’ which will not only ruin business of CNG station owners but deprive national exchequer of revenue of billions of rupees. The government’s plan not to renew the licences and discourage usage of CNG in private vehicles will ruin Rs70 million average direct investment at a CNG station and there are 3,400 outlets in all over the country, said Association Supreme Council Chairman Ghayas Paracha. He said the Petroleum Ministry is under the influence of powerful industrial and fertilizer sectors which is giving 82 per cent less revenue to govt than the CNG sector.

“Government to discourage usage of CNG in private vehicles and not to renew the licence is a right decision,” said the official. “There is a scarcity of gas with the need to divert the commodity to other sectors like industry that use gas efficiently. Private car owners can afford other fuels and the CNG station owners have earned more than double what they invested,” he added but requested not to mention his name. The official was of the view that previous government-supported mushroom growth of CNG consumption was the wrong policy because it caused more harm than good.

A SNGPL official seeking anonymity said the government decision has been made to manage the shortfall of gas and it is being welcomed due to different reasons. Economic evolution shows the ban on stations and diversion of their gas towards industry would bring more benefit as compared to the loss in result of ban on stations.

It is worth mentioning that around 3.7 million vehicles are operating on CNG fuel among of them 1.6 million are public transport. The Petroleum Ministry, however, said government will encourage use of CNG in public transport.