CNG Demand Picks Up

Compressed natural gas consumption, which had declined 60% since March, is gradually picking up, head of CNG department at the state-run National Iranian Oil Products Distribution Company said.
“CNG consumption had reached 24 million cubic meters per day in February. Lockdowns to control the Covid-19 pandemic reduced use of the eco-friendly fuel to as low as 15 mcm/d between March and May,” Mohammad Hossein Baqeri was quoted as saying by IRNA.
As virus-related travel and traffic restrictions are eased, daily CNG consumption is on the rise and is near 20 mcm/d or up 33% compared to last month, Baqeri said.
Referring to an ongoing plan of the government-affiliated NIORDC to convert 1.4 million gasoline-powered vehicles (pickup trucks, taxis and vans) to CNG hybrids, he said 100,000 vehicles were equipped with CNG kits and tanks in the last three months.
It is estimated that CNG consumption would rise by at least 10 mcm/d after the plan is complete. 
In addition to curbing diesel use, the plan also intends to help curtail CO2 emissions from gasoline-based vehicles that contribute to the worsening air pollution.

Regarding financial issues, the official said NIORDC and Bank Mellat signed an agreement last December to contribute to the plan to convert gasoline-based vehicles to hybrid CNG engines.
As per the contract, $510 million required to convert 1.4 million gasoline-powered vehicles to CNG hybrids, will be put up by the lender.
Encouraging motorists to switch to natural gas has been on the government agenda for long. However, the efforts have largely been limited to big cities like Tehran.
Although liquefied petroleum gas can also be used as fuel for powering cars, oil officials including Alireza Arman Moqadam, head of NIORDC planning department says  CNG is a better option.

CNG vs LPG

Drawing parallels between CNG and LPG, he said the primary component in CNG is methane and that is why it produces very little greenhouse gas compared to LPG that is a combination of propane and butane.
Moreover, CNG is safer as it disperses rapidly into the air. Nonetheless, LPG is highly flammable as it is much heavier than air. Hence vehicles equipped with LPG tanks should be parked in places where the air can circulate easily, otherwise if there is a leak, explosion is highly likely.
The official concluded that primary use of CNG is an alternative for fuel in automobiles, whereas LPG commonly is used as fuel for gas barbecue grills and gas cooktops and ovens, for gas fireplaces, and in portable heaters. In Europe, LPG water heaters are common. It is also used as an engine fuel and for backup generators.
Abundant gas deposits plus cost-effective production justify replacing gasoline and diesel with compressed natural gas, the official said, echoing the stance of economic experts and environmentalists.
"Iran has a big gas network and although CNG is less expensive than gasoline, we continue to manufacture gasoline-powered cars instead of natural gas vehicles (NGVs)." 
One cubic meter of CNG costs 6,000 rials (3.5 cents), while a liter of gasoline is sold at 15,000 rials (9 cents). “Filling a car with 20 cubic meters of gas costs two times less compared to the highly pollutant gasoline.”
There are over 2,000 CNG stations in the country that supply 25 million cubic meters of gas to hybrid CNG car owners.

Diesel Output

In related news, IRNA quoted Hamid Hosseini, a spokesman of the Iranian Oil, Gas and Petrochemical Products Exporters' Union, as saying that close to 95 million liters of diesel is produced on a daily basis, of which 15 million liters is exported to neighboring states.
“Despite rumors in the media on Monday regarding an increase in gasoline prices, no decision has been made yet,” he said.
Rejecting reports from the rumor mills, he asserted that any decision would be reported by the NIORDC.
High consumption of diesel (80 million liters per day) stems chiefly from ageing heavy vehicles, which has not only resulted in excessive fuel consumption but also contributes terribly to air pollution. There are 130,000 vehicles in Iran’s truck fleet the manufacturing dates of most go back 25 to 30 years.
Replacing 50% of the depleted trucks will reduce diesel consumption by at least 1 billion liters per year, he claimed.
According to the Roads Ministry Iran needs 15,000 new trucks each year to renovate the aging clunkers.