Over $3.3b invested in CNG development projects

January 3, 2021 - 12:53

TEHRAN - Head of Tehran Compressed Natural Gas (CNG) Association said the government has invested over 140 trillion rials (about $3.33 billion) in CNG-related development projects across the country.

According to Ardeshir Dadras, so far over eight kits and equipment factories, six CNG tank factories, and four compressor factories have been established across the country and the knowledge for the production of more than 80 percent of the parts and equipment used in the CNG industry are indigenized.

Currently, CNG accounts for only two percent of the country’s total fuel basket and the figure should be increased to five percent, Dadras said.

Mentioning the country’s huge gas reserves, the official put the current daily CNG consumption in the country at 22 million cubic meters (mcm), saying that this figure is not desirable considering the level of gas production in the country.

“Given that CNG previously accounted for only 15 percent of the public transport fleet’s fuel basket and the figure has now reached 20 percent, this number can be increased to 35 percent during the Seventh National Development Plan (2022-2026),” he stressed.

Iranian Oil Ministry considers CNG as the national fuel, therefore, the ministry has it on the agenda to increase the share of this fuel in the country's energy basket.

Back in November 2019, the ministry started a program for the rationing of subsidized gasoline and increased fuel prices to reduce the energy subsidies and to use the revenue for supporting underprivileged families.

The implementation of the rationing plan led to the reduction of gasoline consumption, presenting an opportunity for promoting CNG consumption in the country.

In December 2019, the National Iranian Oil Refining and Distribution Company (NIORDC) and Iran’s state-owned Iran Khodro Company (IKCO) signed a memorandum of understanding (MOU) to add new dual-fuel vehicles to the country’s public transportation fleet.

The mentioned MOU was aimed to add 1.46 million dual-fuel vehicles to the public transportation fleet.

Iran’s CNG consumption stood at 19 mcm per day before the implementation of the fuel rationing scheme, however, in mid-September, an official with NIORDC announced that the daily consumption of CNG has reached nearly 23 mcm.

There are currently 2,495 CNG stations across Iran that supply 20 percent of the country’s fuel basket.

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