CNG price doubled.

The government has almost doubled the price of Compressed Natural Gas (CNG).

Raised to Tk 16.75 from Tk 8.5 a cubic metre, the new rate takes effect today.

The caretaker administration has also decided to re-fix fares of CNG-run auto rickshaws and cabs, said a handout issued yesterday by Press Information Department (PIB).

Owners of the CNG-driven transport were asked not to increase fares until the new rates are settled. The government would not accept any hike in fares on the pretext of spiked price of CNG, added the PID release.
The reason for the hike is to reduce the losses that Petrobangla has to incur for upward trend in prices of liquid fuels on the global market and the widening spread between buying and selling prices of gas.

In July 2004, CNG was priced at Tk 8.5 per cubic metre when octane would sell at Tk 35 a litre.
“At that time, the price of CNG was 25 percent of octane’s. Now after the new price, the ratio remains the same as the price of octane by this time has shot up to Tk 67 per litre,” observed an energy ministry official.

Back in 2002, when the natural gas was introduced as an alternative fuel in the country, its price was Tk 7.45 per cubic metre.

Presently, around 1,32,000 CNG-fuelled vehicles ply the roads in Dhaka, Chittagong and Comilla. The number of CNG pumps stands at 229 with 19 more set to be opened within a couple of months, said Petrobangla sources.
CNG sector consumes two percent of 1,750 million cubic feet gas produced per day, they added.

Besides increasing the price of CNG, the government has made it compulsory for the filling stations to set up generators within the next eight months.

Sources in Petrobangla said the new price would help increase revenues of the state-run corporation. From sale of one cubic metre CNG at Tk 8.5, Petrobangla used to earn Tk 2.37 while the rest would go to fuel station owners. Now it will get Tk 9.97 from Tk 16.75.

In the wake of galloping prices of conventional fuels and environmental concerns, the government has been encouraging people to convert their vehicles to run on CNG that is low-priced and considered to be eco-friendly.

The use of CNG as motor fuel started becoming popular with more conversion plants and pumps being installed in the private sector.

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