…conversion prices rise
…Innoson offers to hold down prices, create jobs
…NNPC promises more CNG stations
Edo State is leading the pack among Nigeria’s 36 states and Abuja in the country’s push for cheaper mass transportation for citizens through the deployment of compressed natural gas (CNG) driven vehicles.
This assertion was made by Innocent Ifediaso Chukwuma, automotive industry expert and CEO of Innoson Vehicle Manufacturing Limited (IVM) of Nnewi.
One standard cubic meter of CNG ranges between N175 and N270, depending on location. That means it is 30 percent the price of diesel, and 41 percent the price of petrol from the top line. According to a statement by Banner Energy, autogas conversion could save up to 50 percent on fuel costs for vehicle owners.
Chukwuma says as CEO of a motor vehicle manufacturing company, he is well acquainted with industry trends and asserts that Edo State clearly has more CNG driven vehicles, including buses, than any state in the federation.
Data from NIPCO Gas, a joint-venture company between NIPCO and Nigeria Gas Company Limited (NGC), indicate that over 5,600 vehicles in Benin City run on Compressed Natural Gas after the initiative was rolled out in 2007 and commissioned in 2009.
Meanwhile, as the push for more fuel efficient transportation revs up in Nigeria, several developments are taking place in the country’s transportation system.
One of these is that more and more Nigerians, including transporters are rushing to have their vehicles enabled to run on CNG so as to cut operating costs and bring down transport fares to commuters.
Consequently, private CNG conversion companies in Nigeria have raised their charges for converting vehicles from petrol and diesel combustion to CNG, from an average of N300,000 for salon cars to the range of N420,000, while the cost of converting mass transit buses and other heavy duty vehicles have gone up from between N600,000 and N700,000 to between N1,000,000 and N1.2 million.
Following on this, logjams have developed at CNG conversion centres around the country and in many cases, customers are on queues which will take as long as three months before they will be called up to have their vehicles converted.
When our reporter visited a CNG conversion centre, Green Gas Limited in Benin City, the Edo State capital, officials there said their charges for converting vehicles to CNG use had recently gone up from N300,000 to N425,000 for salon cars and light buses (up to 16 seaters) and slightly higher for Sports Utility Vehicles (SUVs).
They attributed the hike in charges to the value of the naira which has taken a haircut against the US dollar since the removal of fuel subsidy and the free float of the naira in May this year.
Officials at Green Gas Limited said they are booked full for weeks on end and have stopped taking orders.
Meanwhile, Chukwuma, CEO of Innoson Automobiles, said with some support from the Federal Government his company could bring about seamless CNG conversions around Nigeria.
His words: “If Federal Government wants CNG buses cheaper, give us support so we can introduce conversion centres, so we can open stations. We can convert at N300,000 per bus for initial investment. Federal Government should give us initial support to localise it now.
“We need support to expand capacity. Our present capacity is for production of 30,000 vehicles per annum. We are going to help people convert their vehicles and create jobs.”
He said: “We are currently training about 200 young people for CNG conversion. We are keeping the boys busy so they don’t go into antisocial things.
“We want to establish another Innoson Auto manufacturing plant in Lagos and one in the north.”
He said his company was currently concentrating on the manufacture of buses and also focusing on CNG conversions.
Meanwhile, the Nigerian National Petroleum Company Limited (NNPC Ltd) says it has entered into strategic partnership with NIPCO Gas Limited to develop 56 CNG stations across the country.
The NNPC Ltd said the partnership was part of its commitment to reducing carbon footprint and providing cheaper alternative fuel to motorists.
Briefing journalists in Abuja recently, Malam Mele Kyari, Group Chief Executive Officer, NNPC Ltd., said the initiative was in addition to the phased deployment of 56 CNG stations planned by NNPC Retail across the country.
He further said the collaboration would expand the country’s CNG infrastructure, improve access to CNG, and accelerate the adoption of cheaper and cleaner alternative fuel to be used by buses, cars and tricycles.
Speaking on its price when operational, Kyari said CNG price per kg would be determined by market forces, adding that the price would be very affordable because gas was more stable than petroleum.
He said the project would bring multiple benefits to Nigerians, including access to cheaper fuel, reduced cost of transportation, reduced carbon emission, create new business value chains and streams of job opportunities.
“Under the NNPC-NIPCO strategic partnership, 35 state-of-the-art CNG stations will be constructed nationwide, including three Mother stations.
“Once fully operational, the stations can service over 200,000 vehicles daily, thereby significantly reducing carbon emissions and associated impact on climate.
“The project will be rolled out in phases. The first phase, comprising 21 CNG stations, will support intra-city transportation and be ready by the first quarter of 2024.
“The second phase, comprising 35 CNG stations, will support inter-city transformation and will be ready by the first quarter of 2025,” he said.
To deepen and sustain this initiative, the GCEO said the NNPC Ltd. had floated NNPC Prime LNG Limited for domestic LNG production and supply.
He said the deployment phases would be in Short, medium and long term.
He explained that the short term would cover immediate deployment in major cities, utilising existing NNPC Retail and NIPCOS stations to co-locate the CNG refueling stations and also provide workshop for vehicle conversion/retrofit.
“The Medium Term will cover deployment across the country to deepen the utilisation across the country to provide more vehicle conversion workshops and partner with Original Equipment Manufacturers (OEMS) for supply of re-fuelling stations, conversion kits LNG/CNG trucks, among others.
“The long term will cover In-Country Production to capture and penetrate regional markets with design and production of key refueling equipment, conversion kits among others,” he said.
According to him, NIPCO Gas Limited is currently operating 14 CNG stations across Nigeria and has converted over 7,000 vehicles to run on CNG.