The Iranian Oil Ministry on Monday awarded contracts to two subsidiary companies of the Defense Ministry for launching some 400 CNG stations across Iran.

Deputy Oil Minister Jalil Salari said the new CNG pumps will enable Iran to cut up to 6 million liters per day from its gasoline bill.

Salari said more than 2,500 CNG stations are currently active in Iran, helping to save up to 23 million liters per day of gasoline in the country.

Iran is one of the largest producers of natural gas in the world. The country has a large network for distribution of gas which makes it possible to set up CNG pumps in almost every spot in the country.

The plan for expansion of CNG pumps network in Iran comes as the country is struggling to contain a rising demand for gasoline that has been exacerbated in recent years because of increasing smuggling activity across the borders.

Salari, who also leads Iranian Oil Ministry’s fuel operations, said that average gasoline use in Iran had reached 116 million liters per day.

He said annual demand for gasoline in the country had increased by nearly 63% in five years to reach 42 billion liters.

The official said the Iranian Oil Ministry is currently supplying 23 million cubic meters (mcm) per day of natural gas to motorists via CNG pumps, adding that the figure can easily increase to 35 mcm per day if more cars are modified to be able to use the fuel.