INTERVIEW WITH GENERAL SECRETARY CNG STATION OWNERS' ASSOCIATION OF PAKISTAN

KHALIL AHMED
(feedback@pgeconomist.com)
Jan 10 - 16, 20
11

Mohammad Abbas Sajid is a graduate mechanical engineer of NED University of Engineering and Technology Karachi (1983) and later studied business management at the Katz School of Business at the University of Pittsburgh U.S.A. He started his own business by the name of Engineering Services in 1984 which is a mechanical engineering firm dealing in mechanical, HVAC, plumbing, firefighting systems and telecommunication infrastructure development. In 1999, he started CNG business by the name of CNG 2000 opposite Star Gate Shara-e-Faisal, Karachi and also became the general secretary of the CNG Station Owners' Association of Pakistan, He also remained President of ASHRAE (American Society of Heating, Refrigerating, and Air Conditioning Engineers.) Pakistan chapter for the term 2007-2008. Currently, he is member of FPCCI Standing Committee on Petroleum and Petroleum Products, and member FPCCI Standing Committee on Environment.

He has attended numerous international conferences around the world related to CNG and ASHRAE. He is a life member of Pakistan Engineering Council, Executive Council Member of Pakistan HVACR Society, and General Secretary of Pakistan Society of Plumbing Professionals.

PAGE: WHAT ARE YOUR VIEWS ABOUT NATURAL GAS DEMAND AND SUPPLY IN PAKISTAN?

MOHAMMAD ABBAS SAJID: As is evident, each winter there comes a period of severe shortage of natural gas throughout country especially in the central and northern parts mainly because of increased demand by the domestic sector for heating purposes. This results in load shedding in different sectors like industries, domestic, CNG and independent power producers. This demand and supply gap is increasing with every passing year where more and more unplanned gas connections are given without realizing that our supply situation is not improving as no new sizeable reserves have been explored or commissioned. The existing gas reserves are burned with random, unplanned usage by being supplied to IPP's and industries which are using obsolete and old machinery and equipment with very low efficiencies.

PAGE: WHAT STEPS, IN YOUR OPINION, SHOULD BE TAKEN BY PAKISTAN TO FILL THE GAP?

MOHAMMAD ABBAS SAJID: The government should immediately take steps to improve the security situation in the country specially the remote areas of Sindh and Balochistan where majority of gas fields are situated. This will encourage the private sector and international gas exploration companies to increase their efforts for exploring new gas fields, which are known to exist in these areas. Furthermore, the Thar coal project in Sindh should be pursued and started immediately which has huge potential and can turn the economy of the country around within the next few years as huge quantities of coal gas can be extracted and fed into the existing infrastructure of the gas companies to provide sustained gas supply to all sectors.

PAGE: HOW WOULD YOU COMMENT ON NATURAL GAS BUSINESS IN PAKISTAN?

MOHAMMAD ABBAS SAJID: Natural gas business in Pakistan used to be a good business when it really started expanding into a full fledged industry around 1999. But, over the next decade every person with suitable finances jumped into this business without realizing the feasibility of the business and the location of their particular sites. In many areas, mushrooming growth of CNG stations has ruined the business resulting in losses to the investors and forcing them to go for discounts and indulging in meter tampering and other illegal and immoral activities. In this context, OGRA is also partly to be blamed which has issued CNG licenses in huge number without keeping the interest of the license holder in view.

PAGE: HOW WOULD YOU COMMENT ON PRICE MECHANISM OF NATURAL GAS IN PAKISTAN?

MOHAMMAD ABBAS SAJID: The current pricing mechanism of natural gas is very imbalanced especially for the CNG sector for which the gas tariff is the highest among all slabs. This results in higher prices of CNG for the consumers, which in turn affect all segments of the society as transport costs are a major portion of the costing of almost all household items. The CNG Station Owners' Association of Pakistan has had detailed discussions with the government over the CNG pricing and a comprehensive pricing formula based on the present gas pricing and other factors affecting the CNG pricing is now in place.

PAGE: WHAT INCENTIVES CNG SECTOR NEEDS FROM THE GOVERNMENT OF PAKISTAN?

MOHAMMAD ABBAS SAJID: The efficient use of natural gas as a precious resource has to be ensured to benefit our country in the long-run. The government should form a group of technocrats consisting of all stakeholders to look into the long term policies regarding natural gas exploration, distribution, pricing and usage. The Thar coal gasification project has huge potential and has the promise to give a turnaround to our country if properly and sensibly exploited. It should be given top priority as this project can supply natural gas and diesel eliminating totally or largely reducing our imports of oil. It can also be used for power generation at very low cost. The CNG sector should be given a reduced gas tariff by the government to make it a more desirable fuel for the public.