Monday, November 29, 1999

CNG prices hiked by Rs 5.60 per kg to Rs 27.50 in Delhi

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New Delhi, June 16 (PTI) Indraprastha Gas Ltd (IGL) today hiked Compressed Natural Gas (CNG) prices here by over 25 per cent, following the government''s move to more than double the price of natural gas. CNG rates in Delhi will go up by Rs 5.60 per kg - from Rs 21.90 to Rs 27.50 per kg, IGL said in a statement here. "The new consumer price of Rs 27.50 per kg in Delhi and Rs 30.60 per kg in Noida, Greater Noida and Ghaziabad would be effective from midight tonight," it said. The hike was necessitated because of the government''s decision to raise natural gas prices from Rs 3.2 per cubic meter to Rs 7.5 per cubic meter (USD 4.2 per million British thermal unit). IGL, however, did not increase the price of gas that it pipes to households for cooking purpose. Piped natural gas will continue to be priced at Rs 15.92 per cubic meter. Sources said a rate hike would have resulted in piped gas losing its cost competitiveness over rival domestic LPG. IGL may decide to raise piped gas price by close to a rupee if the government were to raise LPG prices. "We are constrained to increase the retail selling price of CNG in Delhi, Noida, Greater Noida and Ghaziabad due to the increase in the input price of gas procured by IGL along with its corresponding taxes and duties," IGL Director (Commercial) Manmohan Singh said. Even after today''s price hike, CNG would still offer 59 per cent savings in terms of running cost compared to petrol driven vehicles at the current level of prices in Delhi. When compared to diesel driven vehicles, the economics in favour of CNG at revised price would be 28 per cent. Singh said the increase in CNG prices will marginally impact the per kilometer running cost for the vehicles. "For autos, the increase would be just 16 paisa per km, for car/taxi it would be 27 paisa per km and in case of buses, the increase would be Rs 1.60 per km, which translates to less than 3 paisa per passenger-km," he said. Prior to the price hike, CNG gave 40-41 per cent better fuel efficiency than diesel and 67 per cent saving over petrol in terms of cost. Even after the hike, CNG in Delhi will be the cheapest fuel in the country. IGL in Delhi and MGL in Mumbai are the only city gas companies in the country that buy government-controlled gas, called APM gas, the price of which were raised last month. APM gas makes up for 90 per cent of the fuel that IGL buys. It buys about 2 million standard cubic meters per day of APM gas from state gas utility GAIL India and the rest 0.2 mmscmd from Reliance Industries.

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