Pakistan CNG Market Prepared by MISL June 2008

Pakistan CNG Industry Growth 2 Pakistan CNG Market - (C) 2008 MISL  Tremendous Growth in last 8 years  Pakistan among top three CNG users in world (other two are Argentina & Brazil). No. of Stations in 1999 increased from 50 to 1089 (cumulative investment exceeding US$ 600 Million)

Pakistan CNG Industry Growth (cont) 3 Pakistan CNG Market - (C) 2008 MISL  2,165 stations in pipeline (US$ 450 Million investment expected in next two years)  Industry growth rate consistent around 50% per annum  More than 1 Million vehicles on CNG in Pakistan

Success Factors 4 Pakistan CNG Market - (C) 2008 MISL  Price differential around 50% vs petrol  Direct Government Support  Custom Duty Incentives etc.  Network of Refueling Stations  High Quality Vehicles, Kits  Private Sector Participation

Success Factors 5 Pakistan CNG Market - (C) 2008 MISL  Growth expected to continue due to govt Support, Incentives and Price differential vis-à-vis petrol  50% p. a. growth rate to continue for next 2 years Auto Manufacturers are introducing OEM CNG vehicles. Approx. 50% are produced with factory fitted CNG Kits

Success Factors (continued) 6 Pakistan CNG Market - (C) 2008 MISL  Deteriorating environmental conditions in big cities has led government plan reduction of diesel usage in urban areas.  Legislation in progress to cut down on diesel and introduce CNG fleets / buses. Major City (Karachi, Lahore, Rawalpindi) Governments have announced plans to introduce CNG buses in next 1- 2 years

CNG Standards 7 Pakistan CNG Market - (C) 2008 MISL  CNG Rules 1992 is the governing rule for installation / selection of equipment. It is based on NZ  DOT 3AA and ASME Section VIII Vessels are allowed for CNG cylinders / vessels  NZ 5454 is followed for Vehicle CNG Cylinders  For general guidance, NFPA 54 and 58 are also followed.  Other countries (Brazil, Argentina, Italy and Australia) have their own standards / specifications for CNG  ISO standards are being formulated for NGV  All equipment / installations are verified / inspected by Government appointed inspectors prior to operation.  Annual inspection / clearance is also required

Compressors Commonly Used 8 Pakistan CNG Market - (C) 2008 MISL  Geo – Korean - an air cooled Compressor. Hot weather condition is not suitable for such type of compressor, hence it has been problematic.  Hamworthy UK - Hamworthy is a UK made compressor providing prompt delivery 30 days to 45 days in off season.  Compair UK - low capacity Compressor max 320 m 3 per hr low range  SAFE Italian

Dispensers Commonly Used 9 Pakistan CNG Market - (C) 2008 MISL  FTI Canada - good performance reviews without complaint from station operators, Price Pak Rupee 2.0 million to 2.2 million (US$1 = Pak Rs. 67)  Tefla Pakistan - Body made in Pakistan and main parts are import from USA. Dispenser with Micro Motion, good support 1 year warranty within 24 hour support and service. 2 year record maintenance facility of cars filled money charged etc. 3 password level. Price in Pak Rupee 1.25 Million on cash and Pak Rupee 1.3 Million with leasing facility.  Compac USA - Not as much data record facility as compared with Tefla Pakistani Compressor. Price Pak Rupee 1.25 Million.