HPCL starts selling most expensive CNG in India
Hindustan Petroleum is blaming the curtailment of D6 gas supplies for the unprecedented hike in the price of CNG sold from its 16 stations across Ahmedabad.
Better known as India’s second largest state-owned refiner, HPCL is the only company in Gujarat other than Sabarmati Gas that was allocated D6 gas by the central government in Delhi. “We were receiving 49,000 cm/d of D6 gas,” confirms HPCL.
“But these supplies stopped on September 24.” A month later on October 21 HPCL began receiving its first R-LNG from GSPC and on October 28 increased its CNG pump price from Rs41.55/kg to Rs50.20/kg – making it more expensive than diesel, selling at Rs45/litre.
Overnight it also became the most expensive CNG sold in India. HPCL tells us it is paying $16.45/mmbtu for R-LNG, a far cry from the Rs4.20/mmbtu it was paying for D6 gas.
Sadly, HPCL’s customers are being asked to swallow the rise. Other retailers like GSPC Gas, which has 117 CNG stations, and Adani Gas with 47, are likely to follow suit and hike their prices too.
With VAT charged at 15% on CNG, analysts ask whether this environmentally friendly fuel can retain its competitive edge over petrol and diesel in Gujarat. In Delhi, Indraprastha Gas charges no VAT.
“Obviously it is more difficult to convince people to convert to CNG,” a source tells us. “People will ask why convert my car to CNG.
” A typical CNG conversion kit costs anything from Rs40,000 ($800) to Rs65,000 ($1300). Other companies talk of more far-reaching consequences.
“If people stop buying CNG,” says one retailer, “what do we do with CNG stations we set up with such heavy investments” A typical CNG station in Gujarat requires an investment of around Rs2cr ($400,000). Company CNG price Hindustan Petroleum Rs50.20/kg Adani Gas Rs40.50/kg Charotar Gas Rs40.50/kg GSPC Gas Rs40.25/kg Sabarmati Gas Rs40.25/kg Gujarat Gas Rs39.75/kg Avantika Gas Rs38/kg Green Gas Rs38/kg Indraprastha Gas Rs32/kg Mahanagar Gas Rs32/kg