The CNG Station Owners Association of Pakistan (CSOAP) has been negotiating with six foreign companies to establish CNG kit plants which may cost around $500 million.
This initiative has been taken to cater for the increasing demand of CNG equipment in the country and to capture the potential regional market of over $8 billion in Bangladesh, Sri Lanka, Iran and Nepal etc.
The Chairman CSOAP, Malik Khuda Bakhsh told Business Recorder on Thursday that in May, a delegation of the association would be visiting Iran on an invitation to share expertise with Iranians for setting up of CNG stations and conversion of vehicles.
"Iran has plans to set up 500 CNG stations and convert 800,000 vehicles in three phases and hopefully, we can grab a good share in this plan," he added.
The idea is to set up our own manufacturing plants, dispenser, storage facilities and CNG kits, Malik Khuda Bakhsh said adding that for the past two months, "we are negotiating with six companies of high repute based in the United States, Canada, New Zealand, Argentine, Italy and the United Kingdom under transfer of technology agreement."
The CSOAP chairman said, "we have also planned to set up such manufacturing plant through potential foreign investors.
The increase in CNG conversion in the country would help reduce $ 1.5 billion of oil import-bill, he added.
Presently, over 505 CNG stations have been set up with an investment of about $ 400 million and over 461,000 vehicles have so far been converted to CNG throughout the country, Malik said.
The Ministry for Petroleum and Natural Resources has issued over 400 licenses for setting up of CNG stations and an investment of about $ 400 million is expected through this move, he added.
The CSOAP chairman said that the Oil and Gas Regulatory Authority (Ogra) is encouraging investment in CNG sector, and has assured CSOAP that before assigning the job of 'third party inspectors' the association would be taken into confidence.
The CNG industry appreciates the co-operation extended by the Ministry of Petroleum and the Ogra, he said adding that as a regulatory body, Ogra is engaged in supervising oil and gas sector for inspection of CNG and LPG stations.
The Ogra has assured that the authority will first pre-qualify the inspectors and call the association members for verification and if they are satisfied then will they be assigned the inspector's job, Malik Khuda Bakhsh added.