A CNG (Compressed Natural Gas) dealership is a retail outlet authorized to distribute CNG fuel to vehicles. Dealerships are usually set up by oil and gas companies or city gas distribution companies.
Any individual, partnership firm, company, cooperative society, or trust that meets the eligibility criteria set by the issuing authority (e.g., city gas distributor) can apply.
Typical requirements include:
Indian citizenship
Minimum age: 21 years
Educational qualification: Usually 10th pass or above
Financial capability (proof of funds)
Land availability (owned or leased land suitable for setting up the station)
Visit the official website of the gas distribution company (e.g., IGL, GAIL Gas, Adani Total Gas, etc.)
Look for dealership or franchisee announcements
Fill out the application form and submit required documents
Shortlisted applicants may be called for interviews or verification
Identity proof (Aadhaar/PAN)
Address proof
Educational certificates
Land ownership or lease documents
Financial documents (ITR, bank statements, etc.)
Size: Usually 800–1200 sq. meters (varies by company)
Location: Preferably roadside with good vehicle traffic
Zoning: Must comply with local commercial or industrial zoning regulations
NOC from local authorities may be required
The total investment can range from ₹75 lakhs to ₹2 crores, depending on:
Location
Land development
CNG equipment
Civil and electrical works
Some companies may offer partial support or partnerships (DODO model – Dealer Owned Dealer Operated).
DODO stands for Dealer Owned Dealer Operated:
The dealer provides land and builds the station as per company specs
The company provides CNG supply and technical support
The dealer operates and earns margins on sales
Profit depends on:
Sales volume
Operational costs
Margin per kg of CNG (usually set by the company)
Estimated margins can range between ₹3–₹6 per kg, but this varies.
Typically, 6 to 12 months, depending on:
Land readiness
Approvals and licenses
Equipment installation
Supply infrastructure
This depends on the model and company. Some companies may charge a nominal franchise fee, while others may operate on a revenue-sharing model.
Yes, most companies provide training for:
Station operations
Customer service
Safety protocols
Equipment handling
Not always. While experience is helpful, many companies accept new entrepreneurs who meet the eligibility and financial criteria.
You can contact the regional or corporate office of the gas distribution company in your area. Also, check their official website for dealership advertisements and contact details.
CNG stands for Compressed Natural Gas. It is a gaseous fuel and is a mixture of hydrocarbons, mainly methane, in the range of 89% to 90%.Due to its low density, it is compressed to a pressure of 200-250 Kg/cm² (g) to enhance the vehicle on-board storage capacity.
Yes, it is safe. The properties of CNG make it a safe fuel. It is lighter than air, so in case of a leak it just rises up and disperses into the atmosphere. Besides, a high auto-ignition temperature of 540 degrees centigrade as against petrol’s 360 degrees centigrade, makes it a safe fuel. Also, in case of a leak, if CNG’s concentration in the air is less than 5% or more than 15%, the gas will not burn even in the presence of a spark
All spark-ignited engines can be converted to CNG, but a specially designed conversion kit is required for the purpose. The kit consists of a cylinder to be fixed in the boot of the car and other equipment to allow gas flow into the engine.
Yes, even after conversion to CNG, the vehicle continues to be fitted with the petrol carburettor and fuel tank. The vehicle can therefore run on dual fuel, either on CNG or petrol, whenever desired, simply by flicking a switch on the dashboard.
The cost of converting a vehicle to CNG depends on its type and make. Broadly, it varies between Rs 25,000 to Rs 55,000 (approximately).
CNG cylinders are manufactured from a special steel alloy and are seamless in construction. Their compact size allows them to easily fit even in a small car. An empty CNG cylinder with a 50 liter-water-carrying capacity weighs 48 kg (approximately), with a length of 835 mm and a diameter of 316 mm. The 50 liter capacity cylinder is the one most regularly used; cylinders with 45 liter, 55 liter, 60 liter and 65 liter capacity are used as well.
A cylinder with a 50 liter water-carrying capacity is capable of carrying approximately 9 kg of CNG. This is equivalent to 12.5 liters of petrol and will allow a run of about 150-160 kms to a medium sized 1300 CC car. An electronic fuel gauge fitted on the dashboard as part of the conversion kit indicates the quantity of CNG left in the cylinder.
CNG cylinders are designed and built in such a way so as to withstand high pressure. The maximum pressure in a CNG cylinder is up to 200 kg/cm2 (g) (about 2840 pounds per square inch (gauge) or psi[g]). CNG cylinders are safe as they are manufactured as per specific requirements and tested before use, in accordance with international specifications and standards, and are duly approved by the Chief Controller of Explosives. Moreover, they are provided with a pressure relief device (PRD) that consists of a fusible plug and a burst disc that ruptures in case of inadvertent high pressure and temperature.
The fuel bill on the basis of average running of vehicle is reduced by 50 percent approximately. The cost of installation of the kit is recovered within a year, given average distances covered in driving.
CNG kit is safe and simple. It gives years of trouble free operation. It doesn’t require frequent servicing. Just as for all other fuels, it is advised to have routine services. An authorized person should be consulted for service. As per Gas Cylinder Rules, 1981, the cylinder should undergo hydro-stretch testing every 5 years to check pressure tolerance.
Owing to CNG’s distinct features, it does not contaminate or dilute crankcase oil, giving a new lease of life to the engine. The absence of any lead content in CNG helps avoid lead fouling of plugs, thereby enhancing plug life. One of the important benefits of CNG is that upon entering the engine in the form of a gas (and not as a spray or mist like other fuels), it doesn’t disturb the presence of lubricating oil in the engine, and reduces chances of wear and tear.
CNG provides easy starting, reliable idling and smooth acceleration. The acceleration of a CNG vehicle is a bit slower, which is due to a power loss of 5-15%. This can be minimized by proper tuning on CNG like advancing the spark timing to take advantage of the high octane rating of the fuel.
Yes, a diesel vehicle can be converted to run on CNG, but the conversion cost is higher than the conversion of petrol vehicles.