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How FG is striving to transform Nigerian economy with its CNG Initiative

In response to the challenges posed by the fuel subsidy removal, the Federal Government recently launched the Presidential Compressed Natural Gas Initiative (P-CNGi). This initiative aims to facilitate the conversion of one million vehicles to compressed natural gas (CNG) over the next three years, by offering free CNG kits and conversion services.

To kickstart this ambitious project, the P-CNGi has signed a Memorandum of Understanding (MoU) with several Conversion Workshop Owners. The initiative, described as the largest vehicle conversion effort worldwide, is set to utilize 123 identified workshops, with a target of expanding to 2,000 workshops and completing the conversions by 2027.

At the MoU signing event in Abuja, P-CNGi Programme Director and CEO, Mr. Michael Oluwagbemi, highlighted the involvement of key partners, including NIPCO Gas, Portland Gas Ltd., Fix It 45, ABG Oil, and the Nigeria Institute of Transport Technology (NITT). These partners will play a critical role in implementing the Conversion Incentive Programme, which focuses on converting vehicles from Premium Motor Spirit (PMS) to CNG engines.

The government’s initiative addresses concerns about the high conversion costs, which typically amount to around N500,000. Under the programme, commercial vehicle operators who are part of unions like the Road Transport Employers Association of Nigeria (RTEAN), the Nigerian Association of Transport Owners (NATO), and the National Union of Road Transport Workers (NURTW) will receive the conversion kits and installation services for free.

Additionally, rideshare operators such as Bolt Nigeria and Uber will benefit from a 50% discount on equipment costs, with the government covering the remaining 50%. These operators can also opt for installment payments without needing to pay upfront.

The P-CNGi plans to distribute approximately 20,000 conversion kits in the next three months under a palliative initiative, with further funding allocated by the National Assembly to ensure the availability of necessary kits and cylinders by the fourth quarter of 2024. This initiative aims to lower transportation costs for Nigerians, offering a more affordable and sustainable alternative to traditional fuel sources.

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