BY EMEKA EJERE
The National Autogas Scheme recently launched by President Mohammadu Buhari and deepening domestic utilisation of Liquefied Petroleum Gas (LPG), also known as cooking gas, promise to create about 12.5 million direct and indirect jobs for Nigerians.
This was the position of Dr. Mohammed Ibrahim, chairman, National Gas Expansion Programme (NGEP), in a statement after a meeting with stakeholders ahead of the launch.
The National Autogas Rollout Initiative is targeted at cushioning the harsh economic effects of the deregulation of the downstream sector of the petroleum industry, according to the federal government.
The initiative, tagged ‘National Gas Expansion Programme and National Autogas Roll-out Initiative,’ and launched virtually, was conceived to convert vehicles from running on petrol to running on gas.
In September, the minister of State for Petroleum Resources, Timipre Sylva revealed that Nigerians can now convert cars using petrol to gas, which is cheaper, with effect from October 2020. The Department of Petroleum Resources also ordered 9,000 filling stations nationwide to begin the installation of facilities for gas products.
In October, the federal government estimated that the Compressed Natural Gas (CNG) will cost N97 per litre as it had promised to provide alternatives to the Premium Motor Spirit (PMS), otherwise known as petrol, for poor Nigerians.
At the launch in the State House, Abuja, on Tuesday, Buhari urged Nigerians to embrace the use of gas as an alternative to petrol, adding that despite Nigeria’s endowment with natural gas resources, the product has not been used optimally.
He said: “It is no longer news that the vast natural gas resources, which Nigeria is endowed with, have hitherto been used sub-optimally as a result of a dearth of gas processing facilities and infrastructural connectivity for effective and optimal domestic utilisation.”
According to him, the expansion of Nigeria’s level of domestic natural gas has become imperative in view of the country’s proven reserve of about 203 trillion cubic feet (TCF) and an additional 600 TCF, which earned the country the ninth place in the world ranking.
Stating that the deregulation of the downstream petroleum sector had exposed many to price volatilities in the global market, Buhari canvassed a shift to a more affordable alternative to an energy, especially with Nigeria’s heavy reserve, saying the current economic crisis makes reverting to gas utilisation timely.
“Therefore, the rollout of the National Gas Expansion Programme, Autogas Initiative, is coming at the right time, especially in light of global crude oil market fluctuations coupled with the full deregulation of the local PMS market.
“These developments have made it imperative to focus on gas as an alternative fuel to move Nigeria from the conventional dependence on white products for autos and prime-movers of industrial applications to cleaner, more available, accessible and affordable energy source.
“The outcome will not only cushion the effect of the downstream deregulation that this government has to painfully implement, but also create new markets and enormous job opportunities for our people,” he said.
Also speaking during the launch, Sylva noted that the petroleum ministry is focusing on skill development, technology and manpower as well as growth in the utilisation of LPG, CNG and LNG.
He said the National Gas Expansion Programme, initiated this year to boost the utilisation of gas in the short and medium-term, “is expected to create two million jobs per annum, promote skills acquisition and enhance technology transfer in addition to growing the nation’s gross domestic product (GDP).”
Speaking further, the minister said: “We would start in the first quarter of next year with over 100 buses and we would continue to incrementally add the buses until we get to that number. We are going to have one million conversion kits, which would be with the people who would be converting the vehicles. Any motorist that wants to convert his or her vehicle would only drive into the conversion centres and convert their vehicles free at all time.
“Unfortunately, we have not utilized our gas resources optimally. We have over 200 trillion cubic feet of gas, TCF, already discovered. We have initiated programmes in the gas supply side, with the proposed launch of gas facilities in Edo State and the National Gas Flare Commercialisation Programme, but we needed to boost the utilization side, and that is what this programme is about. Today’s roll-out marks the optimal utilisation of Nigeria’s gas resources across the country.”
“The availability of autogas as an alternative fuel option will afford Nigerians cheaper, a cleaner and additional choice of fuel, cheaper than the price of PMS, cleaner for our environment, better for our automobiles and other engines,” he added.
From PMS to autogas
Meanwhile, automobile owners are to pay up to N250, 000 for the conversion to enable their vehicles to run on gas. Speaking at Channels Television Programme monitored by Busines Hallmark, the technical adviser on Gas Business and Policy Implementation to the minister of state for Petroleum, Justice Derefaka, disclosed that the conversion would be carried out at various centres nationwide.
“The conversion of your vehicle is not something that will take three weeks or seven days; it will take you around seven to eight hours because they (technicians) need to do a diagnosis of your vehicle to see if it is fit for conversion. After that, they will test for roadworthiness and then proceed.
“The owner of the car will decide to say I want to run on autogas or CNG or LNG and like the honourable minister had mentioned before, conversion has basic strands, you can partner with your bank and the bank will now agree with the conversion centre to convert your vehicle, not for free entirely.
“The installer will now put some form of mechanism that each time you buy the gas; a certain amount will be deducted to pay for the conversion kit. Some people will say it is too expensive but I do not think it is because, within a period of five to seven months, you’ve already paid off the cost.”
“The cost varies; it depends on the cylinder of the vehicle. But on the average, it is around N200, 000 to N250, 000 and this is for a four-cylinder vehicle but it becomes a little bit higher for a six-cylinder vehicle.
If you take your vehicle to some of the centres like the one commissioned yesterday (Tuesday), technicians and original equipment manufacturers are there so you can bring your vehicles for conversion to start running on gas.”
Rising LPG consumption
In March, the Petroleum Products Pricing Regulatory Agency (PPPRA) revealed that Nigerians consumed 89,910 metric tonnes, MT, of LPG also known as cooking gas, in January 2020, 7.9 per cent above the national consumption target of 83,330MT.
Executive Secretary of the PPPRA, Abdulkadir Saidu, who disclosed this in a statement in Abuja, revealed that over the past two years, domestic LPG consumption had steadily been on the upward swing.
Saidu attributed the upsurge in cooking gas consumption in the country to the impact of federal government policy and programme on deepening LPG penetration nationwide and increased awareness and utilisation of LPG in the domestic economy.
Other factors, he said, are the improved performance of private sector operators in the products supply and distribution chain; the entrance of new players (investors) in the sector, as a result of the enabling environment created and inclusion of new LPG storage and reception facilities in the NLNG domestic supply chain.
“Given the current trend, the federal government’s target of five million metric tonnes by 2022 is achievable if the current tempo of sensitisation and coordination is sustained and improved upon by government, regulators and industry players,” he said.