Tampines to get CNG station in 2011

It will be 6th kiosk here; Trans-Cab's owner aims to expand network
Christopher Tan Straits Times 22 Dec 10;

BY THE middle of next year, owners of 5,500 or so compressed natural gas (CNG) vehicles plying here - half of them cabs - can top up at one more refuelling station.

This will bring their number in Singapore to six.

Union Energy, which runs Trans-Cab, Singapore's second-biggest cab company, has secured a 100,000 sq ft site in Tampines Street 92 to build a CNG station - its second since opening a 76,000 sq ft facility in Old Toh Tuck Road a little over a year ago.

The company, owned by businessman Teo Kiang Ang, has also made a bid for rival Smart Taxis' two CNG stations in Mandai and Serangoon.

Although discussions on the purchase of Smart's stations have stalled, Mr Teo said that 'if the price is right, we can talk again'.

If he is eventually successful in his bid, he will practically have a monopoly of the CNG refuelling market.

There are only two other small refuelling kiosks - in Jalan Buroh and on Jurong Island, both operated by joint ventures between Singapore Petroleum Company and Sembcorp Gas.

CNG is considered to be environmentally friendlier than petrol and diesel because it produces less carbon and other emissions. It is also cheaper, costing around $1.40 a kg. One kg of gas is equivalent to 1.3 litres of petrol, which today costs $1.90 a litre.

CNG is currently duty-free. But even if a duty of 20 cents a kg is phased in from 2012, as has been announced, it is likely to still be cheaper than petrol.

Mr Teo did not want to reveal his offer price for Smart's stations, saying it was confidential.

Mr Johnny Harjantho, managing director of Smart, also declined to shed light on why the deal fell through.

When asked why he is selling the stations, Mr Harjantho said: 'I am a businessman, so whoever makes me an offer, I will look at it. I'm here to make profit.'

Trans-Cab's Tampines refuelling station will also house a taxi workshop that will help it cope with a fast-expanding fleet.

Mr Teo said half of his fleet of about 4,000 taxis run on diesel, and the other half on CNG. 'I'm expanding for the future,' he said.

Recently, he also said that he was aiming to grow his cab fleet - second only to ComfortDelGro's 15,600 - to 8,000 by 2014.

But he added a qualifier yesterday: 'If the situation allows, we will,' he said, referring to the escalating certificate of entitlement (COE) prices.

COE prices - which have trebled from a year ago to more than $47,000 for cabs - are expected to have a significant impact on larger operators because they usually have a bigger pool of ageing cabs to replace.

ComfortDelGro spokesman Tammy Tan, however, said her company's fleet is relatively young.

'We are watching COE prices closely and may slow the replacement of our fleet if the increases persist,' she said. 'We have no plans at this point to increase rentals.'

Smart's Mr Harjantho said COE prices are not the only problem cab companies are facing.

'COE is No. 1, but we are also finding it hard to manage insurance costs,' he said.

Insurance companies are generally reluctant to cover taxis because of their relatively high accident claims. Those which do often impose a high 'excess' - an initial amount the insured is liable for before the insurer pays.

'Our excess is $5,000 a cab,' Mr Harjantho said, adding that insurance-related expenses cost Smart 'millions of dollars' each year.