With the fu­el sub­sidy ex­pect­ed to be a whop­ping $4.3 bil­lion for the 2010/2011 fis­cal year, chair­man of the Nat­ur­al Gas Ve­hi­cles Task Force, Frank Look Kin, has promised that by the end of the year the coun­try's "mo­tor ve­hi­cle pop­u­la­tion will be in a po­si­tion to start mov­ing in­to com­pressed nat­ur­al gas (CNG) and away from diesel and gaso­line." Speak­ing to the Busi­ness Guardian on Mon­day, Look Kin said: "In No­vem­ber, we ex­pect that the Brent­wood ser­vice sta­tion will be com­plet­ed in Ch­agua­nas and, by the end of the year, we ex­pect that we will be able to start mov­ing mo­torists mov­ing to CNG."

The chair­man of the NGV task force con­firmed that the pro­jec­tion was for the fu­el sub­sidy to ex­ceed $4 bil­lion this year and that the Gov­ern­ment re­mained com­mit­ted to con­vert­ing 100,000 ve­hi­cles to CNG by 2015.

He said the Gov­ern­ment had giv­en ap­proval for the con­struc­tion of sev­en ad­di­tion­al ser­vice sta­tions, which will sig­nif­i­cant­ly in­crease the coun­try's CNG cov­er­age. "This is sev­en mul­ti-fu­el sta­tions, so you will have oth­er fu­els and not just CNG there, but we ex­pect ad­di­tion­al ser­vice sta­tions will be put in and these sta­tions will be ex­clu­sive­ly CNG sta­tions," said Look Kin. There have been calls from sev­er­al peo­ple, in­clud­ing the Cen­tral Bank Gov­er­nor Ewart Williams for the Gov­ern­ment to re­view the fu­el sub­sidy. Williams told a re­cent news con­fer­ence: "Whether the fu­el sub­sidy is $2 bil­lion or $4 bil­lion, it is a lot of mon­ey and the Gov­ern­ment has to re­view if it is worth keep­ing this sub­sidy. It can­not es­cape look­ing at it." In June, man­ag­er of the NGV task force Ray­mond Fran­co, told a sem­i­nar:

"The prob­lem is that nat­ur­al gas prices have re­mained the same while oil prices have gone up. If we sup­pose that the oil price re­mains what it has av­er­aged so far for the year, then for 2011 the fu­el sub­sidy will be in ex­cess of $4.3 bil­lion." He said there were coun­tries that had made the switch to LNG and, in so do­ing, placed time­lines for peo­ple to con­vert be­fore they even­tu­al­ly lift­ed the cost of fu­el or im­posed re­stric­tions on the use of ar­eas like city cen­tres. Fran­co told the sem­i­nar that in­clud­ed maxi-taxi dri­vers that the Gov­ern­ment was spend­ing on av­er­age $7,000 a month to sup­port the op­er­a­tions of each maxi-taxi. He said the cost was sim­ply not sus­tain­able and the Gov­ern­ment want­ed to see all the maxi-taxis con­vert­ed to CNG. Fran­co said even if the Gov­ern­ment paid for the con­ver­sion of all the maxi-taxis, it will still save mon­ey.

He point­ed out that over a five-year pe­ri­od, the Gov­ern­ment sub­si­dies on diesel for maxi-taxis meant that tax­pay­ers were pay­ing more than the orig­i­nal cost of the maxi-taxis. "If that is the case, then the stat may as well buy the maxi-taxis," Fran­co ar­gued. He al­so point­ed out that the sit­u­a­tion was the same for PTSC bus­es with the Gov­ern­ment sub­si­dis­ing diesel for PTSC bus­es to the tune of $950,000 a bus over a five-year pe­ri­od when the orig­i­nal price of the bus is $800,000. He said the com­mit­tee is con­sid­er­ing rec­om­mend­ing to the Gov­ern­ment that no new maxi-taxi li­cence should be grant­ed un­less it's for nat­ur­al gas ve­hi­cles and on­ly nat­ur­al gas ve­hi­cles be al­lowed on the Pri­or­i­ty Bus Route. Look Kin said that the NGV com­mit­tee had sent rec­om­men­da­tions to the Min­is­ter of En­er­gy that he hopes will ad­dress the con­cerns of the maxi-taxi dri­vers and bring them on­board.

"We have made rec­om­men­da­tions to the gov­ern­ment about the maxi-taxis, but be­cause we have not had a de­ci­sion, it will not be ap­pro­pri­ate for me to talk about it," said Look Kin. The Busi­ness Guardian has learnt that of the $4.3 bil­lion fu­el sub­sidy, $2.5 bil­lion was to sup­port diesel fu­el. Al­so, that the Gov­ern­ment will look at the fu­el sub­sidy, but on­ly af­ter it has made CNG avail­able as an al­ter­na­tive fu­el.

The Na­tion­al Gas Com­pa­ny is to be the first state com­pa­ny to con­vert its en­tire fleet to CNG and re­cent­ly went out for ten­ders for the pro­vi­sion of 175 nat­ur­al gas ve­hi­cles. Look Kin said he was told that there have been bids but no de­ci­sion has been made. The com­mit­tee has rec­om­mend­ed tax breaks to make it very at­trac­tive to im­port nat­ur­al gas ve­hi­cles.

EN­ER­GY RE­PORTER