Nigeria may spend N5 trillion converting petrol vehicles to gas

The Presidency yesterday said the cost of vehicle conversions for targeted five million vehicles may hit N5 trillion in no time.

Programme Director and Chief Executive of the Presidential Committee on Compressed Natural Gas Initiative (Pi-CNG), Michael Oluwagbemi said the conversion cost, including kits and services, is approximately N1 million per vehicle.

Speaking at a panel session at the Practical Nigerian Content Forum in Yenegoa, Bayelsa State, Oluwagbami said there is a target of converting five million vehicles, which represents a N5 trillion market opportunity.

He said there is a significant rise in the number of conversion centers in Nigeria, from seven in 2023 to 158, with a target of 1,000 across the country.

Speaking at the session titled “From Policy to Practice: Strengthening Domestication for Economic Development” at 13th edition of the programme, Oluwagbami said: “The goal of increasing the number of conversion centers is to facilitate the conversion of petrol cars to compressed natural gas (CNG) vehicles, creating a robust market for CNG stations.”

He emphasised the need for local manufacturing of conversion kits, stressing that while most components are currently imported, efforts are underway to domesticate production.

He disclosed that the government is planning a CNG manufacturing hub in Ajaokuta, Kogi State, where 10 hectares of land have already been secured.

Pipes, filters, and valves and other critical parts would be manufactured locally, adding that the Electronic Control Unit (ECU) could be developed through reverse engineering.

Oluwagbemi, while seeking assistance of the Nigerian Content Development and Monitoring Board (NCDMB) to collaborate on the development of the Ajaokuta CNG hub under the Nigeria Oil and Gas Park Scheme (NOGaPS), said there are plans for assembly plants dedicated to producing fully CNG-powered vehicles and outlined Pi-CNG’s commitment to converting 500,000 commercial vehicles.

“We are working with the Nigerian Institute of Transport Technology (NITT) to certify trainees and ensure that local mechanics have the skills to handle CNG conversions and maintenance. We aim to create opportunities for mechanics and entrepreneurs to own CNG maintenance or conversion stations,” he said.

Oluwagbemi said: “The cost of setting up a CNG refueling station, initially about $600,000, is being mitigated by the introduction of composite refueling units. These portable units, modeled after technologies used in India, are being deployed in Nigeria and offer faster refueling capabilities.”