A public hearing to consider a rise of almost 8 per cent in domestic natural gas prices ended in Beijing on Friday, with few objections heard.

The gas provider, the Beijing Gas Group Limited Liability Company, proposed the price be lifted by 0.15 yuan (2 US cents) to 2.05 yuan (26 US cents) per cubic metre because its purchasing price for natural gas had risen by 0.15 yuan per cubic metre since August 1, 2005, said Zhou Si, the company's general manager.

The company had paid an extra 110 million yuan (US$13.9 million) for household gas by the end of October this year, and the company also needed capital guarantees for pipeline maintenance and infrastructure construction, Zhou said.

The natural gas price was relatively low compared with that of other forms of energy, such as liquefied petroleum gas and electricity, and the city's current domestic gas price was lower than that of other big cities such as Tianjin (2.2 yuan, or 28 US cents) and Shanghai (2.1 yuan, or 27 US cents), Zhou said.

The company also proposed to establish a gas price adjustment mechanism based on purchase prices, to be adjusted every three years.

Twenty-one of the 30 public representatives expressed approval for the price hike at Friday's public hearing, held by the Beijing Municipal Development and Reform Commission.

"Most of my neighbours told me that an increase of 3 to 4 yuan (37 to 50 US cents) in their monthly bills will not affect their lives that much," said Liu Ruiqian, from the city's Xuanwu District.

About 3 million Beijing households are hooked up to natural gas, and households using an average of 18 cubic metres of gas per month will see their monthly bills rise by 2.7 yuan (34 US cents) if the proposal is adopted.

Five representatives agreed with a price adjustment, but they hoped the rise could be lower than proposed. Only four voiced objections.

(China Daily 12/23/2006 page2)

(For more biz stories, please visit Industry Updates)