Oil and gas marketers as well as fuel users were on Monday excited at the move by the Federal Government to convert cars and generators in the country to run on gas.
The Minister of State for Petroleum Resources, Timipre Sylva said the government would begin converting the cars and generators of Nigerians to run on gas from October.
According to Sylva, the conversation will be done free of charge for all Nigerians to cushion the effect of the hike in pump price of petrol on them.
The minister who spoke on NTA’s ‘Good Morning Nigeria’, said cars are capable of running on both gas and petrol.
The minister said the move would reduce carbon emissions as well as the demand for Premium Motor Spirit otherwise known as petrol.
He said: “And when you convert your car for free, you go to the filling station, you see the price of PMS (Premium Motor Spirit) you see the price of gas, you can decide to buy LPG (Liquefied Petroleum Gas) or CNG (Compressed Natural Gas), you can decide to buy LNG (Liquefied Natural gas). These are all going to be available and we are going to have a roll-out plan for this within October.
“Nigerians will have alternatives. So, we are also creating that alternative so that you can go to buy gas.”
Oil marketers said the move would develop the gas value chain.
“Clear policy directives and legislative framework aimed at generating demand, as well as customs duty and tax waivers will be required and fast-tracked to jumpstart the sector and attract investment into the gas space,” said Tunji Oyebanji, president of Major Oil Marketers Association of Nigeria (MOMAN).
Dr Mohammed Ibrahim, Chairman, National Gas Expansion Programme (NGEP), said the promotion of gas as replacement for fuel will save Nigeria the much-needed foreign exchange expended on importation of refined products.
Mr Emeka Akabogu, an oil industry expert, said: “We must warn, however, that the role of government in this regard should be limited to facilitation by way of incentives, guidelines and monitoring regulatory compliance, and not delving into operations.”
A manager at NIPCO in Ogun State, Taofik Lawal said: “CNG is drastically cheaper than petrol. We sell at N95 per kg and if we need to transport to another station may sell for N110 or slightly higher.
“CNG fuel systems are sealed, which prevents any spill or evaporation losses. There is an increase in the life of lubricating oils, as CNG does not contaminate and dilute the crankcase oil.”
But Lawal said the current impediment is the cost of the CNG kits which is about N200,000.
Sunday Dawodu, MD, Skylop Ultimate Gas Limited, said the high cost of CNG accessories contributes to the low rate of conversion by motorists and urged the Federal Government to consider the removal of duty fees on imported CNG accessories.
The Nigerian National Petroleum Corporation (NNPC) has pledged to support ongoing initiatives by the Ministry of Petroleum Resources to aggressively activate CNG refill stations nationwide.
The Group Managing Director, Mele Kyari, affirmed that this would provide relief. This is after Nigeria announced the deregulation and retail price of petrol skyrocketed to over N160 per litre last week.
CBN unveils steps for N250bn gas fund
The Central Bank of Nigeria (CBN) on Monday released the framework for the implementation of the intervention facility for the National Gas Expansion Programme.
The N250 billion intervention will also help stimulate investment in the gas value chain the CBN said, adding that large-scale projects under the intervention will be financed under the Power and Airlines Intervention Fund (PAIF).
Small-scale operators and retail distributors will be financed by the NIRSAL Microfinance Bank (NMFB) and/or any other Participating Financial Institution (PFI) under the Agribusiness/Small and Medium and Medium Enterprises Investment Scheme (AgSMEIS).
The initiative is to be implemented with the Ministry of Petroleum Resources (MPR), it noted.
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