City suffers yet another day without CNG

KARACHI: The city’s private motorists and commuters using public transport faced great difficulties on Tuesday as the majority of the gas stations were kept closed for the second day in protest against what their owners claim is a “highly unreasonable” retail price of CNG that is causing them “massive financial losses”.

The gas stations remained shut even though the CNG associations had not officially given a strike call. To make matters worse, the “unofficial strike” is apparently for an indefinite period. No date has been announced as to when the closed gas stations will reopen.

Hyderabad, Jamshoro, Sukkur, Nawabshah, Larkana and Mirpur Khas are among the affected regions of Sindh while in Punjab, people are facing severe difficulties in Sargodha and Bahawalpur.

CNG stations are shut in various areas of Khyber Pakhtunkhwa and Balochistan.

“Around 98 percent of the 298 CNG stations in Karachi stayed shut to protest against the unjust retail price of CNG,” a senior office-bearer of the central CNG association told.

“The majority of over 600 CNG stations in other parts of Sindh also remained closed.”

He refused to give a specific date as to when would the owners of the closed CNG stations end their strike.

Massive queues of vehicles were seen at a few company-operated gas stations in the city that remained open. They included a gas station near Askari-IV; two along Sharea Faisal, one near Drigh Road and the other close to the PAF Base Faisal and one in Malir Cantonment. A very few public transport vehicles were seen plying the roads.

“The CNG stations have been shut down to avoid further financial losses and in view of the unrecovered operational costs for running a gas station that had previously been allowed by the Oil and Gas Regulatory Authority under its earlier CNG pricing mechanism,” said Suleman Sulemanjee, the chairman of the Federation of Pakistan Chambers of Commerce and Industry’s standing committee on CNG and former chief of the All Pakistan CNG Association’s Sindh zone.

“On receiving the latest gas bills from the Sui Southern Gas Company, the CNG station owners did their due accounting work and have come to the conclusion that the CNG retail sale price fixed at Rs54.16 per kg is causing a serious negative cash flow situation for them,” he added.

“With gas bills issued to them, the cost borne by the CNG station owners at Rs49.80 per kg and the Rs4 difference in the purchase and sale of gas has been too meagre an earning ratio, making it impossible to recover the due operational cost of running a CNG station.”

Sulemanjee maintained that the present situation has forced the CNG station owners to invest money from their own resources for running their businesses.

“These operational costs cover electricity bill charges, labour cost, maintenance, and the wear and tear cost of the machinery installed at the CNG filling stations. At such an unreasonable cost, the CNG station owners have been forced to sell gas at a loss of Rs15 or Rs16 per kg with no prospect of earning any reasonable margin of profit as allowed under the law and the constitution.” He said the closed CNG stations would reopen when Ogra announced a reasonable CNG retail price.