Nigeria’s autogas policy which could help the country leverage its huge gas assets, cut down excessive demand for fuel and foreign exchange is still struggling to take off ten months after an elaborate launch in December 2020.
Sources close to the programme confided in BusinessDay that the slow take-off has to do with logistics, raising concerns on whether it was not well thought out before the launch.
Garba Deen Muhammad, group general manager, public affairs division of the Nigerian National Petroleum Corporation (NNPC), said the government has not jettisoned the programme, but that “there are some logistics issues that we are working to resolve.”
These logistic issues, according to BusinessDay findings, include inadequate micro-distribution centres to provide liquefied petroleum gas to retailers, lack of necessary kits needed for the smooth running of the programme, and the exorbitant cost of converting vehicles from fuel usage to gas, among others.
Nigeria has about 600 trillion cubic feet of gas reserves which could become less useful as the global campaign against fossil fuel/hydrocarbons intensifies and the transition to cleaner energy increasingly becomes a reality.
The autogas programme was launched under the National Gas Expansion Program (NGEP) to herald the nation’s transition from the use of petrol to gas for automobiles as a way of deepening the penetration and utilisation of gas in various forms.
NGEP was designed to include conversion of fuel-powered cars and generators from petrol to gas in line with the government’s plan to make gas the first choice source for cheaper and cleaner energy, with the expectations to deliver at least one million vehicle conversions by the end of 2021.
However, BusinessDay findings have shown that ten months after the launch of the programme, the hope of meeting the target of converting one million vehicles by the end of 2021 may be dashed as the programme is yet to be opened to members of the public.
Minister of state for petroleum resources, Timipre Sylva had during the unveiling of the initiative noted that the autogas programme was an alternative that will afford Nigerians a cheaper and cleaner option to fuel consumption as the government’s target was to convert one million vehicles from petrol to gas usage by 2021 at no cost.
He had said: “We are going to give out free conversion to one million cars. If you want to convert your car, go to any conversion centre and it will be done for free for the first one million car owners.”
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But another senior management staff of the NNPC told BusinessDay that the programme has been put on hold due to a delay in getting land allocation for the establishment of micro-distribution centres.
The staff said there are currently not enough micro-distribution centres to provide the liquefied petroleum gas to retailers who will make it available to customers. This, the source noted, is a critical aspect of the programme.
“The project leaders have been seeking land space where they can locate the MDCs, and we all know it takes time before lands are allocated. This is nobody’s fault, it is the process that takes time but it is surely on course.
“Also, the process of converting the vehicles is ongoing. It is technology, so we have to take it bit by bit. Yes, the target is for us to convert one million vehicles this year; it’s not that it is difficult but once we get an angle, we have to train people and this is where we are now,” the staff added.
Our correspondent, who visited one of the retail stations of the NNPC along Nnamdi Azikiwe Airport Road, Abuja, discovered that the conversion process has been put on hold, after trials on government official vehicles.
A technician at the centre who identified himself as Bayo, speaking on the progress so far, said the programme was not yet opened to the public for reasons unknown to them.
He explained that vehicle owners who may want to engage private technicians may be expected to pay at least N300,000 for the service, as it is not handled by the Federal Government despite the assurances of ‘free conversion services’ at the commencement of the program.
“After the launch, several vehicles owned by the government have been converted, but we have not converted cars owned by individuals. While some individuals have somewhat shown interest in the programme, the amount charged by the companies carrying out the conversion is quite high.
“I cannot give the reason for the low turnout by Nigerians, it may be that many people are not aware of the programme or it may have to do with the money that they would pay,” the technician at the NNPC Centre, Lugbe said.
A similar visit to the NNPC retail station along Kubwa expressway showed that the LPG is available for sale but the conversion of vehicles is contracted to private firms.
Kunle, another technician who was referred to our correspondent by a sales representative at Kubwa retail station, confirmed that the conversion cost varies with the size of the cylinder of choice.
For example, he said that to convert a Toyota Corolla vehicle to a 4 cylinder gas-enabled car would cost at least N380,000.
“It was N300,000 before but with the new exchange rate, the price has increased,” he stated.
Abbas, a technician with the THLD group confirmed that his company works with the Federal Government on vehicle conversion, adding that the least amount payable for the service was N300,000. “Though the price depends on the kind of cylinder your vehicle can take,” he said.
However, Brenda Ataga, technical adviser on gas business & policy implementation to the minister of state for petroleum resources, said the programme was still on course, with few filling stations already dispensing LPG for vehicles.
Commenting on the high cost of conversion, Ataga said that the prevailing foreign exchange rate was impacting the cost charged by firms. She assured that the government will come through with the ‘free conversion’ exercise it promised.
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