Nigeria’s CNG Initiative Gains Traction, Attracting Over $175 Million in Investments
In an exclusive interview, Michael Oluwagbemi, Programme Director at the Presidential Compressed Natural Gas (Pi-CNG) Initiative, discusses how the programme, launched in August 2023, is starting to deliver results. The CNG initiative is aimed at reducing energy costs, particularly following the removal of the fuel subsidy. Oluwagbemi highlights that over $175 million in investments have been drawn into the initiative, creating thousands of direct and indirect jobs in the process.
Why Did Nigeria’s CNG Initiative Experience Delays?
Oluwagbemi explains that delays were primarily due to the need for proper planning and supply chain issues. Since the CNG industry in Nigeria is still in its early stages, many materials had to be sourced from international markets, such as China and Brazil. Establishing local capacity and training technicians were essential to ensure long-term sustainability. Although these processes took time, the groundwork has been laid, and momentum is building.
Expanding the CNG Programme Across Nigeria’s Corridors
As part of the initiative’s rollout, major transportation corridors have been targeted. The programme initially started in three states—Lagos, FCT, and Edo—but has expanded to include Delta, Oyo, Kaduna, Kogi, Ogun, and Nasarawa. Future plans include activating more states, including Kwara and Niger, by the end of the year. This expansion is designed to ensure that key travel routes across the country are covered by CNG infrastructure.
Encouraging Local Manufacturing and Assembly
Local manufacturing is a crucial part of the initiative’s success. While many components for CNG vehicles were initially imported, Nigeria is now seeing more local assembly and manufacturing. Companies such as Jets Automobile, Innoson, Nord, and others are involved in producing CNG buses and tricycles. Additionally, the initiative is pushing for the establishment of CNG industrial parks in locations like Ajaokuta, further bolstering local production.
Aiming for One Million Vehicle Conversions in Three Years
The Pi-CNG initiative aims to convert one million vehicles in three years, focusing primarily on transit vehicles, which consume 80–85% of Nigeria’s petrol. According to Oluwagbemi, this ambitious goal surpasses global averages, demonstrating Nigeria’s entrepreneurial spirit. This conversion could significantly reduce the country’s reliance on imported petrol and the financial burden of fuel subsidies.
Job Creation and Economic Impact
The CNG initiative has already created 10,000 direct jobs and 100,000 indirect jobs. The programme’s emphasis on local manufacturing, technician training, and the establishment of conversion centres across Nigeria is contributing to these impressive figures. The conversion programme alone has trained over 8,000 technicians and set up more than 130 conversion centres. This economic boost is vital for a nation grappling with unemployment and economic instability.
Overcoming the High Conversion Costs
One of the primary concerns for Nigerians is the high cost of converting vehicles to CNG, which currently ranges from ₦500,000 to ₦1.2 million. However, Oluwagbemi assures that market forces will bring prices down over time. As competition increases, innovative payment solutions like pay-as-you-go models are emerging, making the process more affordable. Furthermore, the federal government is focusing on providing free or discounted conversions for commercial vehicles, which consume the most fuel.
Maintaining Consumer Protection Through Regulation
Despite the government’s hands-off approach to pricing, regulatory frameworks are in place to prevent private sector players from exploiting consumers. State governments, in particular, are encouraged to regulate transportation pricing to ensure that savings from the CNG initiative are passed on to citizens. Additionally, the federal government continues to support policy frameworks that promote affordable and sustainable energy solutions.
Reactions on Social Media
- @Emeka_Chukwuka (Nigeria): “Finally, some good news! The CNG initiative could be a game changer for our economy and transportation system.” #Nigeria #CNGInitiative #EnergyReform
- @ChloeK (UK): “Nigeria’s move to CNG is impressive, especially with the job creation and local manufacturing focus. A blueprint for other developing nations!” #GreenEnergy #CNG #Nigeria
- @Ahmed_Saidu (Nigeria): “We need this CNG initiative to reach all parts of Nigeria fast. Petrol prices are killing us!” #FuelSubsidy #Nigeria #Energy
- @Rachel_Edu (US): “Nigeria making strides in CNG adoption while reducing carbon footprint! Shows great potential.” #ClimateAction #SustainableEnergy #CNG
- @Oluwole_James (Nigeria): “It’s good to hear about job creation, but the government needs to make sure the conversion costs come down for regular Nigerians.” #CNG #NigeriaJobs #EnergyReform
- @Zainab_Abubakar (Nigeria): “Great initiative by the Nigerian government. Hope to see this impact public transport soon!” #CNGNigeria #Energy
- @Johannes_Muller (Germany): “Investing in CNG infrastructure is the right step for Nigeria. Eager to see the long-term economic impact.” #NigeriaEnergy #CNG #Sustainability
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