The price of one standard cubic meter of compressed natural gas has increased from N230 to N450 due to lengthy lines and a lack of refilling facilities. Our reporter learned from merchants that the government had reduced its subsidies and revised the price to N450. Trucks pay N450/SCM, while commercial and automobile drivers continue to get some subsidies, paying N380 for a standard cubic meter of what the government claims is a less expensive substitute for gasoline and diesel.
Michael Oluwagbemi, the program director of the Presidential Compressed Natural Gas Initiative, did not answer his phone on Tuesday. Nonetheless, the latest development was confirmed by a PCNGI officer who wished to remain anonymous due to his lack of authorization to speak to the media.
According to the source, commercial drivers make lower payments to prevent an increase in transportation costs. "Cars and trucks now have different costs at the refueling stations. Therefore, the cost varies according to the kind of vehicle, whether it is a private automobile, truck, or commercial bus," he stated.
He said that there is a subsidy on commercial vehicles when asked if the kind of vehicle should affect the cost of CNG. "Commercial vehicles receive a pricing reduction. While private vehicles and buses that carry passengers pay less, trucks that move cargo pay more. The insider said, "This is the current situation, but there should be a subsidy across the board."
In addition to the cost, he stated that the PCNGI's primary goal is to increase the number of refilling stations nationwide to shorten the lengthy lines.
"Increasing gas availability is our top priority. To prevent owners of converted vehicles from complaining that their cars lack a location to purchase CNG, we intend to construct additional refueling stations. Some people have converted their cars, yet they will use gasoline when gas is scarce. Therefore, expanding the number of CNG stations around the country is currently our main goal," he stated.
In the meantime, if lines continue to form and costs keep rising, there are concerns that car owners would stop using CNG. "Some people converted their gasoline-powered cars to CNG for as much as N1.5 million." Many may now have to revert to using gasoline due to the price hike and the lengthy queues.
The administration has been attempting to persuade the populace that gasoline is less expensive. It was sold to marketers by the government at a discount. In actuality, there isn't much of a difference between CNG and gasoline.
When contacted, Louis Ibah, the spokesperson for Ekperikpe Ekpo, the Minister of Petroleum Resources (Gas), stated he was unable to speak since he was at an event with the minister. Since the NNPC only revealed a new spokesman on Tuesday, it was not possible to reach them.
According to reports, the price of gasoline increased from N175 per litre to N870 after President Bola Tinubu said in 2023 that the fuel subsidy would no longer be provided. In order to mitigate the impact, the Federal Government encouraged Nigerians to switch to CNG by promoting it as a less expensive fuel than gasoline.
The Federal Government emphasized that it had made great strides in promoting the use of alternative fuels nationwide in June, announcing that more than 100,000 gasoline-powered cars had been switched to CNG in a single year. Oluwagbemi stated that the program had seen significant progress in the previous year as the Federal Government increased its efforts to mitigate the impact of the elimination of gasoline subsidies.
He claimed that in just over a year, the number of CNG-powered cars in the nation had increased from less than 4,000 to around 100,000. We now have 265 conversion centers around the country, up from only seven last year.
Along with expanding from 20 to 60 operating refueling stations and building 175 more, we have also directly created over 10,000 jobs. We now have 60 operational CNG stations, compared to just 20 by the end of 2023. We want to commission another 100 over the course of the following three months," he continued.
"Rome wasn't built in a day," Oluwagbemi said, defending the implementation's speed. The pace at which we are resolving the gasoline subsidy issue cannot be reasonably criticized by those who led Nigeria into it. There are concerns, meanwhile, that the most recent increase in CNG prices may deter its consumers.