Nigeria Inaugurates CNG Plant in Lagos to Alleviate Petrol Subsidy Removal Effects

Nigeria’s federal government on Thursday inaugurated  a 5.2 Million Standard Cubic Feet Per Day (MMSCFD) of Compressed Natural Gas (CNG) plant at the Isolo Industrial Area, Ilasamaja, Lagos.

The government said that the move was aimed at providing an alternative source of fuel and alleviating the effect of petrol subsidy removal on Nigerians.

The CNG facility was built through a partnership between the NNPC Gas Marketing Limited (NGML), a subsidiary of the Nigerian National and Transit Gas Nigeria Limited, a subsidiary of Axxela Limited.

Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, who inaugurated the plant,  said the occasion represented a critical turning point in the development of affordable, sustainable, and secure energy sources in the country.

The minister described 2024 as a historic year for Nigerians, stressing that through  President Bola Tinubu’s courageous decision to eliminate fuel subsidies and promote the acceptability and broader use of Liquefied Petroleum Gas (LPG), he had brought about several fresh beginnings to the lives of Nigerians.

“Although the elimination of the Premium Motor Spirit (PMS) subsidy has brought difficulties, it has also given us a once-in-a-lifetime chance to invent and adopt more economical, efficient, and sustainable energy alternatives,” he stated.

Ekpo noted that the use of CNG as a transport fuel was a mature technology used globally as it was the cleanest burning fuel in terms of nitro-oxide and soot emissions.

According to him, while it can be employed to power passenger cars and city buses, Ekpo noted that CNG passenger vehicles emit 5-10 per cent less carbon dioxide (Co2) comparable to gasoline powered passenger vehicles.

Earlier in his remarks, the Group Chief Executive Officer of NNPC,  Mele Kyari, said that to maintain energy security and provide more access to CNG by the Nigerian populace, the national oil company had reached a Final Investment Decision (FID) with Axxela Limited to deliver six CNG mother and service station plants and stations of 5.2mmscfd capacity each.

He stated that this will be done in selected locations spread across the six geopolitical zones and the Federal Capital Territory (FCT), Abuja.

He said this was to ease access to bulk CNG, adding that the move was in addition to NNPC Retail’s phased deployment of CNG in over 100 stations across the country as well as other Joint Venture (JV) partnerships on CNG.

Kyari revealed that the inauguration of the NNPC CNG Station in Ilasamaja Lagos was part of NNPC’s efforts to grow domestic gas supply and utilisation by deploying gas infrastructure nationwide.  

He said the Petroleum Industry Act (PIA) explicitly mandated NNPC to promote domestic gas utilisation, thereby strengthening the company’s resolve to deploy critical gas infrastructure projects across the country.

“NNPC will continue to deliver more strategic projects for the benefit of our country. We shall utilise our gas resources for industrialisation, power generation and economic prosperity for all,” Kyari stated.

In his speech, the Lagos State Governor, Babajide Sanwo-Olu said the establishment of the CNG plant aligned perfectly with his vision for economic development, job creation and industrialisation in the state.

He said in demonstration of its resolve to champion CNG utilisation across Lagos state, the state government had concluded plans to deploy 2,500 conversion kits and over 2,000 new CNG buses, which will commence operations before the end of the year.

“You have a car you fill with N40,000 to N50,000 , but you have CNG that you can do with less than 20 to 30 per cent of that. It puts money in your pocket. So, I am sure it’s the way to go. CNG also has shown that a significant reduction in all forms of operational costs,” he added.

He described the move by Tinubu to redirect Nigeria to alternative sources of energy as audacious, stressing that the country was already moving forward with the new policy in all parts of the country.

According to him, it will help reduce carbon emissions in the country, adding that there’s also a plan to procure CNG -powered ferries, since Lagos has a large mass of water.

In his remarks, the Ogun State Governor, Dapo Abiodun, represented by the State Commissioner for Environment, Mr. Ola Oresanya said the state was supporting capacity building in CNG conversion to ensure sustainability and promote economic development within the state and beyond. 

Also his goodwill message, the Chief Executive, Presidential CNG Initiative, Mr. Michael Oluwagbemi described the plant inauguration as a testament to  Tinubu’s commitment to providing sustainable energy solutions for Nigerians. 

On his part, the Chief Executive Officer of Axxela, Mr. Bolaji Osunsanya thanked all the stakeholders especially the NNPC for its consistent vision towards the delivery of the plant, stressing that his company’s many years of preparation have now met a golden opportunity to deliver cleaner, cheaper energy to Nigerians.

The NNPC CNG Station Ilasamaja is a 5.2MMscf per day capacity station that can serve vehicles and also supply gas to industries and other companies. The facility has dispensing points for filling cars, buses, trucks and tricycles, utilising CNG and can fill about 3,700 cars or 600 trucks/buses every day thereby providing a constant supply of CNG.

It would deliver CNG at 250 bar into specialised tube trailers for onward delivery to customers beyond the pipeline gas areas, approximately within a 250km radius of the facility.

Also present at the event was the  Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, represented by Executive Director, Hydrocarbon Processing Plants, Installations and Transportation Infrastructure, Francis Ogaree.

The Chief Executive of the Nigerian Upstream Petrolatum Regulatory Commission (NUPRC), Gbenga Komolafe, was represented by the Regional Director, Lagos, Paul Osu, on the occasion.

Emmanuel Addeh and Peter Uzoho

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