Growing worries are arising regarding Nigerians’ attempts to embrace alternate automotive fuel as the present statistics on converting various vehicle types from gasoline to Compressed Natural Gas (CNG) have been described as exorbitant and potentially complicating the government’s efforts to address the escalating cost of Premium Motor Spirit (PMS), also known as gasoline, according to information obtained by LEADERSHIP.
Based on the data collected by our correspondent, the conversion of 1.6-liter gasoline vehicles would range from N300,000 to N400,000, while tricycles with 4 Stroke Engine would cost between N100,000 to N200,000.
Meanwhile, lorries and vans would have a high cost of up to N1.8 million, while 4 Stroke Petrol generator engines would cost about N90,000.
From an economic standpoint, a converted gasoline vehicle would only consume N40 per kilometer, resulting in savings of 40 percent for the owner, while a tricycle would consume N10 per kilometer with savings ranging from 50 to 75 percent compared to gasoline, and a converted truck would consume N360 per kilometer.
The documents propose a relief package of N200 billion to facilitate the conversion of one million vehicles, N200 billion for converting two million tricycles, and about N250 billion for five million power generating sets.
Data from the Nigeria LPG Association (NLPGA) obtained by LEADERSHIP provides cost discrepancies between a gas-engine truck and a diesel-engine truck, as well as conversion costs for other categories of petrol engines.
In light of the removal of gasoline subsidies and the escalating cost of gasoline at the pump in the country, Nigerians are now seeking alternative automotive fuels, especially gas, which is deemed affordable and environmentally friendly.
However, experts have cautioned against the repercussions of employing unqualified individuals in the conversion process.
In 2020, the federal government initiated programs aimed at harnessing the country’s massive gas reserves, which include the National Gas Expansion Programme and the National Autogas Roll-out Initiative.
The government views the availability of autogas as a cheaper, cleaner, and more eco-friendly alternative fuel option with less impact on vehicles. The projection is that about one million cars will be converted before the end of 2021.
PwC Nigeria also estimates that the economic activities driven by the domestic utilization of Nigeria’s recoverable proven gas reserves have the potential to annually generate a Gross Value Added (GVA) of $18.3 billion to the domestic economy and $10.5 billion through direct economic value addition. Liquified Natural Gas (LPG) contributes $1.3 billion, and its excess allied components, Propane and Butane, contribute an additional $2 billion, which compares to generating annual export value of $7 billion.
Additionally, PwC projects that tapping into the country’s proven reserves for domestic utilization can support 6.5 million full-time equivalent jobs every year.
However, in driving the program, the NLPGA has published a joint document with the Nigerian Gas Association (NGA), the Association of Local Distributors of Gas, and the Lagos Chamber of Commerce and Industry (LCCI).
The LPG group further elaborated on the types of engines that can use autogas, the various autogas options available, the commercial advantages of autogas, and proposed relief measures that the government can adopt and provide to the public.
The NLPGA has already invested in research and training and has recently introduced a project for a training and resource center, which upon completion will offer over 30 areas of study in a curriculum based on gas operations, usage, safety, and other related fields.
Felix Ekundayo, the Managing Director of Asiko Energy and President of the Nigerian LPG Association, recently discussed the price fluctuations of liquefied petroleum gas (cooking gas) in Nigeria as well as the implications of converting fuel consumption vehicles to compressed natural gas.
Ekundayo raised concerns about the infrastructure gap and conversion costs, which may lead people to engage the services of unqualified individuals.