ISLAMABAD: The price of compressed natural gas (CNG) in Punjab was reduced by Rs5.30 per litre to Rs41.90 on Tuesday. The previous price was Rs47.20.

`The new price approximately works out at Rs41.90 per litre and will be applicable from Wednesday, Ghiyas Abdullah Paracha, a leader of the CNG owners association, told Dawn.

He said the price had been reduced after successful talks between Sui Northern Gas Pipelines Limited (SNGPL) and All Pakistan CNG Association on the directive of Petroleum Minister Shahid Khagan Abbasi.

Mr Paracha said CNG prices in Punjab were already deregulated because filling stations in the province were being run on regasified liquefied natural gas (RLNG).

He said SNGPL had agreed to charge RLNG`s provisional price approved by the Oil and Gas Regulatory Authority (Ogra) on the basis of 13.37 per cent of crude price. As a consequence, the company will now charge lower terminal charges at about 80 cents per million British Thermal Unit (MMBTU) in view of higher R LNG supplies.

Mr Paracha said the terminal charges would further decline to 66 cents per MMBTU because RLNG supplies would go up beyond 400 MMCFD (million cubic feet per day) in a couple of days from the previous 300 MMCFD.

Consequently, SNGPL charged LNG supplies to CNG stations at $4.84 per MMBTU which was finally worked out at $6.45 after including 5pc general sales tax and administrative charges.

Mr Paracha said that about 900 CNG stations were expected to reopen on Wednesday after a gap of about one year, adding that the CNG stations had also decided to charge Rs2 per litre lower administrative charges previously approved by Ogra as an incentive to attract CNG consumers who were compelled to switch over to petrol due to nonavailability of gas.