We welcome with enthusiasm the great insights and analysis shared by the LEADERSHIP Newspaper in their editorial of Wednesday, March 26, 2025. It is our firm belief that government programmes and initiatives improve with each fair criticism and inputs of all well meaning citizens. Albeit, we also believe strongly that such criticism can be improved by engagement and information sharing.
No doubt, the editorial acknowledged the great strides of the Presidential CNG Initiative (PCNGI) in the past year since it was launched by President Bola Ahmed Tinubu, GCFR but notes some emerging constraints especially with respect to infrastructure ensuring long lines and waits for refueling by the hordes of new CNG vehicles occasioned by the successful conversion campaign by the PCNGI. The momentary gap in supply should definitely not be approximated to a crisis, and we urge the Leadership newspaper to rather look closely at the inherent positives.
It must be noted that just barely twelve months ago, there was hardly any CNG vehicles operating in most of the major cities of Nigeria. Nigeria had just seven functional dispensing stations, and many of them had CNG for days and weeks with no demand. Spurred by the PCNGi focused delivery of the Conversion Incentive Program that is delivering on the President’s promise to convert one million qualified (mostly commercial) vehicles for free, that has changed for the positive. With over sixty functional stations and at least 175 new ones under development, Nigeria’s glory CNG days are here.
The nation now boasts of fifty thousand CNG vehicles from a stock of less than three thousand just one year ago, with the private sector leading the way in adoption via conversion and new CNG vehicle purchases, the sub-sector has not only seen an influx of investments estimated at over five hundred million dollars but created 10,000 direct and over 90,000 indirect jobs as a result. For President Bola Ahmed Tinubu, the CNG sub-sector is the new telecoms sector of this era. Over two hundred conversion centers were established by small business owners in the last year alone. It is driving industrialisation, job creation, productivity, energy transition and investments all at once.
Naturally, this cannot be completely done over night. Painstaking planning and investments are required, driven primarily by positive government policies, incentives and allowance for private innovation and entrepreneurship. Just like cellphone towers did not suddenly dot our landscape overnight when GSM licenses were awarded in 1999/2000, CNG dispensing stations and mother stations as well as LNG plants and L-CNG sites for far flung places will gestate gradually as a result of the investments of the private sector in collaboration with government incentives and support. Dropped calls are still common in Nigeria, no newspaper rushes to declare telecoms crisis as a result. We should be less dramatic and rather support more investments.
In terms of incentives, the PCNGI working closely with policymakers has been able to deliver a tax free regime for the gas and clean vehicle sector that has spurred the huge capital investments in refueling stations. While this takes time to gestate as equipment are procured, fabricated and deployed over 12-24 months at a time by each private player, we are confident that work is being done and succor is coming to the masses whose switch to a cleaner, reliable and safer alternative to PMS and Diesel are long over due and a patriotic thing to do. Nigeria is a gas country that happens to have some oil.
In addition to taxes, the demand stimulation programs of PCNGI from conversion to CNG platform deployments through unions and private sector transport operators have driven demand and signaled supply ensuring investments are committed by investors. This model is superior to contract driven bazar that will be inefficient if investment decisions are being made by bureaucrats instead of the private sector. Private sector led resource allocation may be slower but are more efficient in the long run.
More directly, the PCNGI has also designed, in line with its mandate, targeted intervention infrastructure financing program designed to spur the private sector to deploy Modular Refueling Stations, which are containerised and more suitable for add-ons in existing stations having worked with the regulators (NMDPRA specifically) to approve this methodology late last year. The Refueling On-Lending Program as it is called launched in December 2024, with the first such site launched at Ilorin with Rolling Energy lends financed equipment to conversion partners who install, operate and expand to additional sites.
Under this financing program, 25 sites are planned under Phase 1 and Phase 2, and at least 15 states will directly benefit from this expansion. Soon, states like Enugu, Rivers, Kogi, Ekiti, Niger, Kaduna, Kano and Abia will all benefit from this push to expand the CNG footprint. Commissioning of additional four sites is planned within sixty days, as private sector partners work feverishly to deliver on their promises. We are doing these while enabling a new domestic Autogas market working the Gas Aggregation Company of Nigeria and Nigeria Gas Marketing Limited to ensure these stations get gas molecules consistently at a good competitive price.
Furthermore, the PCNGI has also collaborated and coordinated with the Midstream Downstream Gas Infrastructure Fund (MDGIF), the platform for gas infrastructure financing directly enabled by law to fund this expansion via a dedicated fund aggregated from activities of the oil sector in the Petroleum Industries Act, 2021. In 2024, the MDGIF released the first 123 billion naira of investments most of which went into CNG projects. One of such given to Femadec Limited is set to deliver twenty refueling sites at twenty federal universities starting in May 2025, which inevitably adds to the tapestry of gas storage and distribution infrastructure in Nigeria. Companies like Ibile Oil, NSIK and Rolling were also recipients of funds to trigger Nigeria’s CNG revolution in a coordinated manner. Hence, the government cannot be accused of not planning enough for this reality.
Incremental to all these, is an impending release according to the Honourable Minister of State (Gas) at a recent public forum of additional four hundred billion naira of investments under the MDGIF this year. Some of those funds will co-invest with the PCNGI in Mini-LNG infrastructure to expand the footprint of Autogas to the far North of Nigeria that lacks pipeline gas as we await the completion of the Ajaokuta-Kaduna-Kano (AKK) Pipeline that is ongoing by the NNPCL. Definitely, the federal government is working hard, taking responsibility and no CNG crisis is impending!
While we note the criticism that infrastructure should have existed before the promotion of CNG or removal of subsidy – as LEADERSHIP newspaper erroneously alluded in the extreme, we equally note this is also not practical and runs against the grain of the evident benefit of ending that ruinous regime of siphoning the nation’s resources into the pocket of a few in the name of subsidy. Providing succor via CNG is the way to go, and we can’t wait for perfection to deliver the goods of good governance to the Nigerian people. We must also be clear that government should catalyze, not get into the business of CNG. It is for this reason the PCNGi have led by enabling NOT substituting the private sector.
The practical short term pains of waiting for CNG in some cities will no sooner give way to joy and satisfaction, as our incredible entrepreneurs and private sector deliver on the investments that they started doing last year as government deepened its commitments to the sector with incentives and demand stimulation, which has enabled conversion and signaled suppliers to invest in the CNG sector.
Already, the NNPCL through NNPC Retail has committed to over 120 new CNG stations with over 12 delivered already. NIPCO has committed to 32 new stations with more than ten already delivered. Bovas has committed to eight, with all under construction. AY Shafa has committed to ten with one nearing completion here in Abuja.
Countless other independents including Portland, MBH, Oke Keke, TGIS, Amara, Blue Stone and Femadec are also doing their parts some with as many as 20 sites and others as little as one or two. All will add to the tapestry of Nigeria’s incredible gas infrastructure.
The public should be rest assured that our vibrant private sector players are working with us at the Presidential CNG Initiative leveraging innovative financing to deliver a promise of a gas driven economy to lower costs, increase productivity and competitiveness of Nigeria to deliver renewed hope in line with Mr. President’s promise to all Nigerians. Joy is coming soon. Let us keep faith.
Michael Oluwagbemi is the Program Director/Chief Executive of the Presidential CNG Initiative and writes from Abuja
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