CNG price cut by Rs 30/kg

ISLAMABAD: According to orders of the Supreme Court, the Oil and Gas Regulatory Authority notified a massive reduction in the CNG price by Rs 30.90 per kilogramme for region 1 and Rs 30.38 per kg for region two, on Thursday.

According to the notification issued by OGRA, CNG price has been reduced from Rs 92.54 per kg to Rs 61.64 per kg with a reduction of Rs 30.90 per kg for consumers of Khyber Pakhtunkhwa, Balochistan and Potohar region, including Islamabad, Rawalpindi and Gujjar Khan.

For region two, the price of CNG has been reduced from Rs 84.54 per kg to Rs 54.16 per kg with a reduction of Rs 30.38 per kg. Region two includes Punjab, excluding Potohar region, and Sindh. These prices have been reduced with immediate effect.

OGRA issued the notification of this major decrease after the Supreme Court’s interim order, in which the court declared the current CNG pricing formula against the law and ordered OGRA to implement the July 1, 2012 prices. Following the decrease, transporters have announced to reduce the transport fares also.

Meanwhile, declaring the current CNG pricing formula illegal, the Supreme Court directed the OGRA chairman to fix CNG price in view of the bench’s observations that linking the CNG price with that of petrol and giving the operating cost to the CNG station owners was unreasonable and unjust. At the end of the proceedings, the court asked the chairman to give good news to the public on Eid in the form of reducing CNG prices.

A two-member bench comprising CJP Iftikhar Chaudhry and Justice Jawwad S Khawaja observed that cost components of CNG price included Rs 17.78 as Gas Development Surcharge, Rs 20.80 as operating cost of CNG stations, and Rs 9.55 as cost of linking CNG price with that of petrol.

Regarding CNG station owners, the CJP remarked that due to the Rs 20.80 operating cost, millions of rupees were given as bribe to the authorities for getting licences of CNG stations.

Petroleum and Natural Resources Secretary Waqar Masood informed the bench the government has decided that the pricing of CNG according to that of petrol on weekly basis will be abandoned. “The MoU through which the government and CNG Associations had agreed on a formula operating cost of CNG stations (Rs 20.80) will be immediately suspended and OGRA will develop a new formula,” he further said. The court adjourned the hearing until November 1.