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…Targets Conversion Of 1 Million Vehicles By 2027
CHIDI UGWU
ABUJA – As part of moves to drive investments into the sector, the Presidential Compressed Natural Gas Initiative (PCNGI) on Tuesday officially launched a concessionary pricing framework for autogas CNG, following approval from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
The move designated mobility CNG as a special category, allowing it to be priced at $1.57 per million British thermal units (MMBtu)—significantly lower than the $2.42 and $2.92 per MMBtu set for power and commercial buyers, respectively.
Speaking during the event in Abuja, PCNGI Programme Coordinator Michael Oluwagbemi, said this strategic pricing is part of President Bola Tinubu’s broader energy reforms and aims to accelerate the adoption of CNG in Nigeria’s transport sector.
The concession is valid for an initial five years, renewable for another five, under the Petroleum Industry Act 2021.
Oluwagbemi highlighted the rapid growth of the CNG market, noting an increase from 20 to over 65 CNG stations nationwide in the past year, with more expansions underway.
He said the number of CNG vehicles has surged from about 4,000 to over 50,000, with expectations to reach up to 300,000 by year-end as private sector participation intensifies.
“The Programme Coordinator emphasized that the new framework is designed to prevent arbitrage and ensure CNG is used specifically for transportation, fostering a transparent and organized marketplace, stressing that the initiative is expected to lower transport costs, reduce inflation, and support a cleaner, more secure energy future for Nigeria.
“Like I said, it’s not going to be, a perfect market, from day one, but our work, is to make it more perfect. So every day, we are working on this, one of those works. How many cars, are you looking at, by the end of the year? Okay, I would say that, I estimate, we are looking to have, at least 125,000, to 200,000 vehicles, on the road, in addition to the one, we already have, running on CNG this year.
“We want to be on pace, for one million, like we always said, by the end of 2017. So, if we get closer, to 250,000, 300,000 total, CNG vehicle count, this year, at the end of this year, we’ll have done, a lot of good work. Of course, this is an estimate, it’s not just the PCNG, that is doing this, right? I mean, the private sector, probably converts, about twice, if not three times, the number of vehicles, that we convert, last time.
“And so, to us, we are very eager, the most important work, we have, and I always say this, is to incentivize, the private sector, to do the work. Government, will not do the work.
“The private sector, has a bigger share, of the work, but we are always, to create enabling environment, providing incentives, continue to encourage them, with the right, kind of, targeted incentives, like these, concessionary gas pricing, and deliver, to the Nigerian people, a more secure energy, future, energy and gas” he said.
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