The price of Compressed Natural Gas (CNG) in Nigeria has been fixed at $1.57MMBtu, as announced by Michael Oluwagbemi, the Programme Director/Chief Executive Officer of the Presidential Compressed Natural Gas Initiative (PCNGi).
Notably, this price is lower compared to the rates assigned to commercial and power sector participants, which stand at $2.92 and $2.42, respectively.
The Nigerian Mainstream and Downstream Petroleum Regulatory Authority (NMPDRA) has granted CNG a special status for transportation purposes, considering it as part of gas-based industries (GBI) with the pricing categorization set to last for five years. Renewal of this categorization is subject to the provisions of the Petroleum Industries Act (PIA) 2021.
Under this designation, mobility Compressed Natural Gas is recognized as a subset of Gas to commercial (GTC), making it eligible for Gas Based Industry (GBI) pricing categorization. The initial pricing of $1.57/MMBtu is significantly more affordable than the standard rates of $2.42 and $2.92 for power and commercial buyers, respectively.
It is worth noting that President Bola Tinubu had announced plans in May last year to introduce CNG buses to alleviate the effects of fuel subsidy removal. The government is moving forward with the deployment of 2,700 CNG buses, with the project scheduled for launch before May 29, 2024.