The price of one standard cubic meter of compressed natural gas has increased from N230 to N450 due to long lines and a lack of refilling stations. We learned from retailers that the government recently reduced its subsidies and raised the price to N450.
Trucks pay N450/SCM, but commercial and automobile drivers continue to receive 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 Presidential Compressed Natural Gas Initiative‘s program Director, did not respond on Tuesday when tried to be reached for inquiry. Nonetheless, the new development was confirmed by a PCNGI official who wished to remain anonymous due to his lack of authorisation to speak to the media. According to the source, commercial drivers make lower payments to prevent an increase in transportation costs, BrandSpur national news reports.
According to the source: “The refuelling stations now sell at different prices for cars and trucks. So, the price depends on the type of vehicle, whether it is a commercial bus, a truck or a private car.”
He responded that there is a subsidy on commercial vehicles when asked if the type of vehicle should affect the cost of CNG. He revealed: “The price is subsidised for commercial vehicles. Trucks transporting goods pay higher prices, while private cars and buses that convey passengers buy at a reduced rate. There’s supposed to be a subsidy across the board, but this is the current situation.”
In addition to the cost, he stated that the PCNGI’s primary goal is to increase the number of refilling stations nationwide in order to shorten the lengthy queues. He said: “Our main focus is to increase the availability of gas. We want to build more refuelling stations so that no converted vehicle owner will complain that it doesn’t have a place to buy CNG. Some have converted their vehicles, but when gas is not available, they will be running on petrol. So, our major drive right now is to increase the number of CNG stations nationwide.”
According to a major CNG retailer who spoke with our correspondent, NNPC Gas Marketing Limited examined the prices. The retailer, who wished to remain anonymous, claimed that since 2023, when it eliminated gasoline subsidies, the Federal Government had set a cap on the price of CNG below its cost. He went on to say that to draw in investors, the price might soon increase to N500 or N600/SCM.
Continuing, the retailer said: “I can confirm that the price for CNG was reviewed upward by NGML. Truck drivers are to pay N450/SCM, while commercial drivers will pay N380/SCM. We know that the price may go to N500 or N600 soon. The government subsidised it to attract users and it sold it to marketers at a subsidised rate.”
Car owners are worried that if the lines continue to form and the cost keeps going up, they might stop using CNG.
A ride-hailing driver named Adeyemi Paul reached, had this to say: “Some spent up to N1.5m or more to convert their petrol-powered vehicles to CNG. Now with the price increase and the long queues, many may have to return to petrol. The government has been trying to convince the people that there is cheaper fuel. The government sold it to marketers at a reduced price. In reality, the difference between CNG and petrol is not significant.
“When you see some refuelling stations, the queues are as long as 1.5km. This is not encouraging,” he added.
When contacted, the Minister of Petroleum Resources (gas), Ekperikpe Ekpo’s spokesman, Louis Ibah, said he was unable to speak because he was at a function with the. Because the NNPC only announced a new spokesperson on Tuesday, it was not possible to contact them.
Petrol prices increased from N175 per litre to N870 when President Bola Tinubu declared in 2023 that the fuel subsidy would no longer be provided, according to a The PUNCH report.
Nigerians were encouraged to switch to CNG by the Federal Government, which marketed it as a less expensive fuel than gasoline in order to mitigate the impact. Over 100,000 gasoline-powered vehicles had been converted to CNG in a single year, according to the Federal Government in June, which emphasised that it had made great strides in promoting the use of alternative fuels nationwide.
In the past year, the Programme Director of PCNG said, the Federal Government has made significant progress in mitigating the impact of the removal of fuel subsidies. According to him, in just over a year, the country’s CNG-powered vehicle count increased from less than 4,000 to almost 100,000.
He went on to say: “From just seven conversion centres last year, we now have 265 centres nationwide. We’ve also created over 10,000 direct jobs and grown from 20 to 60 operational refuelling stations, with 175 more underway. So far, we have 60 CNG stations up and running—up from just 20 in late 2023. Over the next three months, we plan to commission an additional 100.”
He had this to say about the pace of implementation: “Rome wasn’t built in a day. Those who led Nigeria into the fuel subsidy crisis cannot fairly criticise the speed at which we’re addressing it.”
