Subsidy removal triggers quest for gas as alternative to petrol

Irked by the hardship induced by the fuel subsidy removal, Nigerians have been urged to shift attention to gas as alternative to petrol. Compressed Natural Gas (CNG) and Liquefied Natural Gas (LPG) have been proposed as alternative to petrol in Nigeria due to the country’s significant natural gas reserves.

Already, NIPCO has commenced massive investment to shift the attention of Nigerians to CNG, which enable cars to run on gas. Some gas filling stations already exist in Lagos, Benin, Ajaokuta, Okene, and Abuja.

The PwC, in its latest report on gas obtained by The Guardian, said: “This has several potential advantages, including lower cost, reduced emissions, and improved fuel efficiency.

“One of the most significant benefits of CNG is that it is considerably cheaper than petrol, which could result in substantial savings for vehicle owners.

“Additionally, the cost of CNG is more stable than the volatile price fluctuations experienced by petrol. Also, the use of CNG could reduce vehicle maintenance cost due to its cleaner burning properties, which produce fewer engine deposits that clog up the engine over time,” it stated.

However, it stated that the adoption of CNG in Nigeria also presents some challenges, which include the initial investment required to retrofit existing vehicles with CNG engines, the need to establish a robust distribution infrastructure for CNG.

It stressed the need for government to initiate good policies and incentives to promote the use of gas. Commenting also on gas as alternative, the President, Nigerian Labour Congress (NLC), Joe Ajaero, said that the group is discussing with the Federal Government on the need to promote the use of gas as alternative fuel in times of subsidy removal.

He said: “We had earlier agreed on the issue of CNG. The product is eco-friendly and it’s cheaper than the petrol we are even talking about now. Let’s exploit this resource that we have in abundance. We are here talking about subsidy,” he said.

Meanwhile, latest report by Africa Energy Chamber (AEC) revealed that Nigeria’s gas production level would hit 1,780 billion cubic feet (bcf) in 2022. According to the report, Nigeria has over 200 trillion cubic feet of natural gas reserves, the biggest in Africa.
The Managing Director, NIPCO Gas Limited, Nagendra Verma, said that the company currently has 14 CNG filling stations in various states across Nigeria, while another six CNG stations are under construction. He said that over 7000 vehicles are presently running on CNG, adding that over 350 truck fleet of NIPCO are all running on gas.

“We have workshops which are fully efficient and fully capable to convert PMS vehicles to gas, we have the expertise and we are ready to convert more vehicles to run on gas,” he said. Verma added: “So, we intend to have CNG stations in almost all the states of Nigeria wherever the pipeline is available.

“Presently, we are laying LNG pipeline for 80 kilometre pipeline from Shagamu interchange to Ibadan.
“The pipeline work is going on. We expect to commission first phase by the end of December 2023. And the entire pipeline is expected to be completed by next year,” he said.

National President, Independent Petroleum Manufacturers Association of Nigeria (IPMAN), Chinedu Okorokwo also endorsed the use of Compressed Natural Gas (CNG) as an alternative energy source to cushion the effect of subsidy removal.

He said: “We have also discovered that by bringing an alternative that is cheaper than even firewood which is CNG will not only create relief for the government and its citizens but it is environmentally friendly.

“The CNG is abundantly available in Nigeria than anywhere in Africa. In the Niger-Delta region, billions of tonnes of gas being wasted daily, these are huge amounts that should be accruing to our GDP but we are wasting it because there is no market for it. So, we are asking the government to create the market.”

He said that the introduction of CNG would cushion the effect occasioned by the high price of fuel currently as a litre of CNG would not cost more than N130 and it could be less.