ISLAMABAD -  Taking undue advantage of the new deregulated regime, the Khyber Pakhtunkhwa Compressed Natural Gas (CNG) stations have increased the gas prices by Rs3 per kg.

The CNG stations in Punjab and Sindh are already charging Rs3 extra from their customers after getting free hand to decide their profit margin. Although Punjab and Sindh CNG association have formally announced their increased rates but the KP CNG stations have started charging, an unannounced, extra prices from their customers.

Prior to deregulation, CNG stations were charging up to Rs75.82 price per kg. The maximum sale prices determined by OGRA were Rs75.82 per kg, but now the CNG stations in the province are charging around Rs78.82 per kg.

It is pertinent to mention here that in December last year, the federal government had deregulated the Compressed Natural Gas (CNG) sector and stripped Oil and Gas Regulatory Authority (OGRA) of the power to determine CNG prices for end-consumer. As a result of the decision, the OGRA has lost its control over the price regulation for the CNG sector for Sindh and Khyber Pakhtunkhwa, leaving the masses at the mercy of the CNG sector. After deregulation of the sector, the government has given a free hand to the CNG owners of Sindh and KP to set its own prices and profit margin without any regulatory control.

The provincial government of KP has earlier warned that they will not follow the Economic Coordination Committee (ECC) decision regarding the deregulation of CNG sector and will keep the prices in the province regulated. However, the authorities now seem helpless in front of the mighty CNG associations.

Earlier in a letter, KP Chief Minister Pervez Khattak has requested Prime Minister Nawaz Sharif to reverse the decision of the ECC regarding the deregulation of the CNG sector. “Deregulation of CNG sector is a major policy decision which will seriously affect the consumers of KP. It is therefore requested to please rescind the impugned notification for deregulation of CNG sector and direct ECC to desist from transgressing into the domain of CCI and call an urgent meeting of CCI,” the letter said. “Alternatively the government of Khyber Pakhtunkhwa will be constrained to regulate the CNG sector in Khyber Pakhtunkhwa,” the letter added.

Similarly, the Sindh government has also alleged the ECC of the cabinet of transgressing its limit by approving CNG deregulation and has asked the federal government to place the issue in front on CCI for consideration. Beside the two provinces, the Planning Ministry and the OGRA were also against the government decision of deregulating of the CNG sector and have proposed that, in absence of the government’s weak monitoring mechanism, the decision will leave the poor consumers at the mercy of CNG owners.

Taking advantage of the free hand given by the federal government’s decision of deregulating the CNG sector, owners of Sindh CNG stations have increased the gas price to Rs70-71 per kg from Rs67.50. Moreover, Punjab CNG association has also increased the price of CNG.