Federal Gov’t To Convert 1m Petrol Vehicles To CNG By 2027

The Federal Government on Wednesday said it hopes to achieve conversion of one million out of about 10 million existing petroleum vehicles in the country to Compressed Natural Gas (CNG) by 2027.

The programme’s Director/Chief Executive of the Pi-CNG, Engr. Michael Oluwagbemi made the disclosure during a stakeholders engagement meeting on agenda for the Presidential Initiative on Compressed Natural Gas (Pi-CNG) in Ilorin, Kwara State.

He added that the conversion will effect zero per cent import duty waiver on vehicles with compressed natural gas (CNG) as well as CNG kits as part of incentives to encourage conversion of existing vehicles to CNG-compliant vehicles.

“This will save Nigeria between about $2.5 bn and $3.5 bn a year and getting us off almost 10 million litres of petrol from what we’re currently using.

“Federal Government in December 2023 circular, approved by Mr. President and issued by the Finance Ministry, through the office of the Special Adviser, Energy, had approved import duty waiver for all CNG auto vehicles as well as kits, including equipment used to manufacture CNG vehicles in Nigeria. It’s the standing order of the Federal Government. It’s for those who are manufacturing CNG vehicles in Nigeria as well as those bringing in vehicles. Meanwhile, yes, there’s still need to comply with regulations by the Standard Organisation of Nigeria, SON, and other regulatory agencies,” he said.

The stakeholders engagement meeting had in attendance officials and members of transport unions as well as affiliate unions in Ekiti, Kwara, Ondo, Kogi, and Osun states.

Oluwagbemi also listed the advantages of the CNG vehicles over petrol vehicles, saying that CNG vehicles run on clear and better energy for a safe environment.

“CNG vehicles run cheaper (40 to 70 per cent cheaper to petrol vehicles), safer (18 per cent saver than petrol/diesel vehicles) and more reliable. With CNG vehicles you go less to mechanics for either oil change or, as the case may be, than other vehicles,” he said.

On the cost of converting petrol vehicles to CNG vehicles, Oluwagbemi said that the cost of conversion is currently between N300,000 and N750,000.

He added that, “the Federal Government is already working on conversion incentives programme to be announced on May 29. It will start gradually and get better. We are looking at conversion of one million vehicles by 2027 and saving Nigeria about $2.5 billion and $3.5 billion a year and getting us off almost 10 million litres of petrol from what we’re currently using.

“The reality is that by the time the FG is able to provide CNG kits and CNG conversion, the commercial vehicles that move about 90 percent of the population, there will be no reason for the FG to renege on the promise to remove subsidy and to ensure that Nigerians do not pay for importation of poverty and export of jobs that was the order of the day when we are used to import petrol rather than exporting gas and using our gas for the benefits of all Nigerians”.

He said that conversion incentive programme would include access to gradual payment and discounted rates for the CNG conversion.