The Nigerian government announced a 50% reduction in the cost of converting vehicles to run on compressed natural gas (CNG) for transporters. This initiative aims to boost the transportation sector by introducing more CNG-powered buses and tricycles, also known as Keke.
Michael Oluwagbemi, the Programme Director of the Presidential Initiative on Compressed Natural Gas (P-CNGI), made this announcement at a stakeholders’ event in Abuja. Represented by Tosin Coker, Oluwagbemi emphasized the initiative’s goal of reducing public transportation costs.
“In the next days, you will witness these buses on the streets of Abuja, even as we also start to make conversion kits available at a 50% discount to the transport sector,” he said.
Folajimi Mohammed, the Managing Director of Portland Gas, highlighted the significant cost savings of CNG vehicles compared to petrol.
“We are seeing close to about 76% savings in cost alone. So without a doubt, we know that adoption of CNG is almost inevitable,” he stated.
He noted that the typical conversion cost of N1.2 million can be recovered within a year by vehicle owners.
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Addressing safety concerns, Mohammed explained that CNG is less likely to cause fires because it is lighter than air and dissipates quickly.
“Is it safe? I am sure this is a very pertinent question everybody has asked. The component of CNG is methane. CH4 is lighter than air. When we mean lighter than air, in the event there is any release of it, it goes and expresses into the air,” he explained.
Since the inception of the P-CNGI, over $50 million has been invested in the CNG sector, a significant increase compared to the past decade.
“I am pleased to report that well over $50 million has been mobilized directly by the sector since then, more than any amount mobilized in the last ten years combined,” Oluwagbemi said.
The initiative is also supported by various private sector partners, development funds, and banks, making it easier for Nigerians, particularly transport operators, to convert their vehicles. In May 2024, the Conversion Incentive Program was introduced to further facilitate the adoption of CNG.
To ensure investor confidence and regulatory compliance, “the P-CNGI has approved over 80 standards and procedures for the CNG conversion industry in collaboration with the Standards Organization of Nigeria. Regulatory bodies are now working together to create the Nigerian Gas Vehicle Monitoring System (NGVMS), a one-stop shop for ensuring safety and efficiency.”
The P-CNGI aims to convert 1 million vehicles to CNG by 2027. Oluwagbemi expressed confidence in achieving this target, highlighting the innovative and resilient nature of Nigerians.
“It is time for us to use our natural resources and our gas resources for the greater good, to drive our transportation sector and economy forward,” he concluded.