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• Planned one million gas-powered vehicles elusive as subsidy removal looms
• Major independent marketers desert scheme as autogas sells for N400/litre
• FG sets aside N250b for vehicle conversion, to begin pilot scheme in 12 states
In December 2020, when President Muhammadu Buhari promised Nigerians, especially labour leaders, that an autogas policy would ensure that vehicles plying the country’s roads run on Compressed Natural Gas (CNG), not many considered it as another government hot air that would add to the administration’s list of failed promises.
However, an investigation by The Guardian shows that the plan is yet to take off despite the commitment of resources for the conversion.
On December 1, 2020, President Buhari had virtually launched the Autogas Initiative on the back of the National Gas Expansion Programme, a much-trumpeted Decade of Gas policy and 203 trillion cubic feet of gas resources, with a promise that nothing less than 40 per cent vehicles plying Nigerian roads would run on compressed natural gas.
Described as an alternative fuel, the Minister of State for Petroleum Resources, Timipre Sylva, had disclosed that the Federal Government’s plan was to provide autogas that would cost between N95 to N97 per litre.
But one year after, infrastructure, high cost of gas, lack of proper planning, prevailing harsh economic realities and safety concerns according to stakeholders, continued to frustrate Buhari’s autogas plan.
As of yesterday, a litre of autogas was selling for an average N400 at the NNPC retail outlet along Kubwa Expressway in Abuja.
An attendant at the station told The Guardian that no one has come to fuel their cars at the gas pump for over two months, adding that only NNPC vehicles, which were converted at the pilot phase of the project, continue to come for a refill once in while.
Initially, the Technical Adviser on Gas Business and Policy Implementation to the Minister of State for Petroleum, Justice Derefaka, had said motorists in the country would need to pay about N250,000 to convert their vehicles to run on gas. However, worsening economic indexes has more than doubled the cost, making the process for the masses a mirage.
In November, last year, weeks to the first anniversary since the promise was made by the President, the Federal Government announced it had set aside N250 billion for willing investors in autogas assembly plants in the country to ensure that autogas conversion of vehicles yielded the desired results. The funds would barely convert 100,000 vehicles to autogas going by market rates.
He explained that the decision to make the money available as a result of the huge amount spent by the government on fuel subsidy, adding that it is in line with President Muhammadu Buhari’s commitment to adopt gas as an alternative fuel for the country.
“If we focus on moving from fossil fuel to Liquified Petroleum Gas (LPG) and Compressed Natural Gas (CNG), it will save us a lot of money because the benefits are enormous,” the minister said.
It was gathered that engineers with four automobile manufacturers had already started receiving training on how to convert vehicles assembled or produced in Nigeria to start using autogas, instead of petrol or diesel.
The Programme Manager, National Liquefied Petroleum Gas Expansion Implementation Plan, Dayo Adeshina, on Friday told newsmen that the LPG component in the autogas initiative would be implemented in 12 states.
According to Adeshina, the 12 states are Lagos, Ogun, Bauchi, Gombe, FCT, Niger, Katsina, Sokoto, Ebonyi, Enugu, Delta and Bayelsa.
Speaking on measures adopted to ensure gas penetration through the autogas initiative, Adeshina said: “I am in charge of the LPG expansion programme; yes, there is an autogas element of it, but it is the LPG aspect that I am responsible for.
“And in this aspect, we are concentrating our target on 12 pilot states and our approach is simple. We are starting with the state governments by getting the vehicles that they are using in those states.
“So, if I take Lagos for example, in the last eight years, Lagos has had vehicles from GAC, JAG, Toyota and Coscharis. So, what we have done is that we have gone to those four companies to tell them that we would like to train their engineers to convert vehicles that they supplied to Lagos State already.
“The idea is that they can convert the vehicles from the use of petrol to LPG and then we can now scale it massively. So, we have done the online training, and we started with Lagos for those four companies.”
“But we are hoping that by the end of the first quarter of this year, they can come in to start the physical conversion of those vehicles,” he said.
WHILE the government had promised to ensure that fuel stations across the country were forced to provide gas dispensing pumps for cars, investors did not buy into the plan.
The Major Oil Marketers Association of Nigeria (MOMAN) told The Guardian that the investment is too risky as market, bankability, consistency in government policies, product plan and other elusive factors made the autogas scheme dead on arrival.
Most of the marketers, including the independent players, see the business as too risky to venture into, as prevailing realities show no viability.
Only two stations are operating in Abuja; one along the Airport Road and owned by NNPC and the other along Kubwa expressway, also owned by the corporation. In total, the entire Federal Capital Territory (FCT) has only two pumps dispensing CNG.
Renowned energy scholar, Wunmi Iledare, described the scheme as mere political expediency, which is conflicting with economic effectiveness and efficiency, adding that the policy for gas as a transition fuel towards removing fuel subsidy “is misplaced and misleading. Hence, the failure was guaranteed from the start with no infrastructure that left much to be desired.”
Worried over the perennial subsidy removal saga, Iledare insisted that full deregulation of the downstream sector remains the only sustainable option.
Group Chairman/CEO at International Energy Services Limited, Dr Diran Fawibe, noted that using autogas as a basis for fuel subsidy removal falls below expectations, adding that even if the government successfully converts one million vehicles to run on gas, it would still be a drop in the ocean.
According to him, the inability of the country to refine petroleum products locally remains a critical loophole on the part of the government in its bid to remove subsidies.
Energy expert at PWC, Habeeb Jaiyeola, said apart from the elusive state of the plan, conversion of energy source in an automotive engine designed for another source presents serious concerns, especially in a country where gas-related explosions persist.
“This intended plan to run cars on gas, which have originally been designed to run on petrol or diesel, is not popular the world over. In addition, these mechanisms are different with different car manufacturers. Any intended conversion of the energy source of the engine must be with necessary consultation and guidance from the original car manufacturers. Gas is extremely flammable and must be treated with caution,” Habeeb said.
Mrs Joyce Daser-Adams, Chief Executive Officer of Auto Lady Engineering Technology, said one of the major challenges in converting a vehicle from fossil fuel to LPG or CNG is the non-availability of parts.
NNPC spokesperson, Garba Deen Muhammad, did not respond to a request by The Guardian on the development, just as the Ministry of Petroleum Resources did not also revert to questions by The Guardian on the issue.
