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Unipet CEO: CNG drive lacks financial incentives

Thursday, March 6, 2014



The nation’s drivers will not move to compressed natural gas (CNG) unless the Government takes the hard decision to remove the fuel subsidy from petroleum products. 


That is the view of energy consultant Gregory McGuire and chief executive officer of Unipet Ron Milford.


In separate interviews with the Business Guardian, the two men agreed the fuel prices are too low, and even if the Government builds sufficient service stations, people are unlikely to convert to CNG unless there is a financial reason to do so.


Their position comes as the National Gas Company (NGC) last week signed a memorandum of understanding (MoU) with the Chinese company, ENN Group, for the provision of advice to help ensure the successful implementation of NGC’s five-year $500 million CNG conversion plan.


Milford said he agreed with McGuire that there was no incentive to push people to CNG, but said the challenge was both on the demand and the supply sides.


“With diesel prices where they are and gasoline prices so cheap, I agree unless you remove the subsidy, then people will not move to CNG. But you first have to ensure there are sufficient service stations and offer people the alternative to switch before you raise the prices of fuel.” Milford said.


The Unipet executive said the original CNG Task Force had authorised seven CNG stations to be build. Unipet was given two at Brentwood in Chaguanas and Tacarigua and both have been constructed and are operating. However, the National Petroleum Company was given five, none of which has been built.


“I don’t think the problem has to do with technology because the technology we are using in our service stations is fine. The real challenge is in constructing the stations on the part of NP. I can’t say why this is so, but the fact is we have built and can build the service stations.”