FG could save $1.5bn annually through gas vehicle project – NIPCO Plc

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The federal government would be saving about $1.5 billion annually if the Natural Gas Vehicles (NGV) project, an initiative that was first introduced by Nigerian Gas Company (NGC), in 1989 is sustained, Leadership reports.

The federal government had also in 2007 granted a license to NIPCO Plc to implement a pilot project in Benin City, Edo State, in partnership with NGC, which led to the formation of a Joint Venture company, known as “Green Gas Ltd”. The JV successfully implemented the pilot with nine operational compressed natural gas (CNG) stations catering to over 4000 NGVs. According to the managing director of NIPCO Plc, Sanjay Teotia, the federal government, between 2012 and 2016 saved over $10 million in foreign exchange.

Teotia said that with 1 million vehicles on natural gas, Nigeria will be saving foreign exchange of about $1.5 billion it required in purchasing 4 billion liters of Premium Motor Spirit (PMS), also called petrol annually. However, it was gathered that the project is being stalled as government has not provided the enabling environment to allow it thrive. The conversion kit as well as other components are currently imported and there are high costs of conversion from petrol to CNG.

Teotia recommended that  government should provide subsidy to vehicle owners for CNG conversion. He added that CNG dispensing stations also have to be tied to the gas pipeline network, which currently exists only in the Southern part of Nigeria which lie between the Eastern and Western domestic gas network, while conscious efforts be put by Government to ensure Gas Pipeline Availability across the country.