New Telegraph

September 29, 2023

Autogas Cheaper, Easy to Access, Can Reflate Economy– Ibrahim

Dr. Mohammed Ibrahim is the Chairman of the National Gas Expansion Programme (NGEP). In this interview with Journalists, he said full adoption of autogas as alternative to petrol and diesel will reflate Nigeria’s weak economy and make President Tinubu’s 100 million jobs creation a reality. But the challenge is the fuel subsidy cabal who continue to sabotage the efforts of the NGEP. PAUL OGBUOKIRI brings the excerpts

Subsidy cabal mocked us that gas expansion programme won’t work because can’t remove subsidy

The removal of the fuel subsidy by President Bola Tinubu has frustrated the activities of the subsidy cabals and some stakeholders who said the gas expansion programme would never work. The Federal Government has concluded plans to ensure that within six months make 9,000 out of the 10,000 registered petrol filling stations across the country to become multi-fuel stations which can dispense autogas.

The promise of the Tinubu-led administration to create 100 million jobs was achievable with the gas expansion programme Over 5 million conversion kits were needed to convert 30 million internal combustion engine (ICE) vehicles to CNG or LNG, which would create 12.5m jobs. Autogas has the potential to really reflate the economy if it is properly done.

Under our NGEP programme, we have what we call the multi-fuel scheme whereby we do not intend to shut down the current petrol stations that we have in the country, about 10,000 of them and like I said earlier, we have carried out an audit whereby 9000 of 10,000 qualify to retrofit to become multi-fuel.

So what is going to happen, and we have a couple already in the system, is that you drive into a filling station, you are going to have dispensing facilities for your petrol, diesel, and kerosene, but in addition, you are going to have the dispensing facilities with the cryogenic tower that enables you to have access to LNG and also a dispensing pump for CNG and also a charging point for your electric vehicles.

So it becomes a multi-fuel retail outlet that enables you to have access to LNG for your long hauls, LPG for your 300km maximum and conventional petrol, diesel and kerosene. But you don’t even need a separate CNG facility because all you just need is if you have your cryogenic tower; you can generate CNG from your LNG in your station by the addition of a pump.

Transition from petrol to autogas has been slow

We have been on with this project for a long while now but most of the state governors, former Willie Obiano of Anambra State have not shown interest. That is why today Anambra State is number one in the states that embraced the use of autogas.

Also, there is this N250 billion National Gas Expansion Programme (NGEP) fund in the Central Bank of Nigeria but has remained dormant in the last four years because it could not be accessed by operators the condition is stringent and not tailored to suit the needs of the industry and investors. We raised our reservation with the Apex bank’s authorities but we were ignoured.

You cannot lift a product you have for farmers, say for instance the Anchor Borrowers Programme and dump on this industry with its peculiarities. The money was meant to assist Nigerian companies involved in the gas value chain, especially the conversion of internal combustible engine (ICE) vehicles into autogas as part of the government’s drive to deepen autogas penetration.

Effort geared towards reviewing the NGEP fund

The NGEP was conceived to serve as a catalyst for adding value to the vast natural gas reserves Nigeria is endowed with and one of the low hanging fruits being explored by the team is the autogas where over 30 million vehicles have been identified for conversion. We have a N250 billion National Gas Expansion Programme (NGEP) fund domiciled in the Central Bank, so that if you want to import conversion kits or if you want to import related products, you can access this fund.

We are trying to review that fund because the immediate past CBN governor when the fund was made available, we went to him. We said, Mr. Godwin Emefiele, you are not an expert in this business, we are experts and we can tell you the kind of products you can make available and the funds you can make available. So the conditions you attach to the funds are so stringent that nobody would be able to access the funds and he didn’t listen to us. Of course, nobody took it.

So, we are hoping that now that we have a new Minister of State in charge of gas who just assumed office and we believe that the government now is responsive to know that you do not make intervention funds for rice cultivation the same condition for CNG. It simply does not work. You cannot make the same intervention funds for fertiliser as you do for textile, it doesn’t work. So you have to have different products for different sectors.

Autogas could reduce number fuel stations

The sad reality is that the moment autogas fully takes off, many petrol stations might have to close down because a gas powered truck or vehicle can drive for 2000km without refueling. Correspondingly the number of retail outlets would have to look for other jobs. It is very sad but it is reality. Even without the government removing subsidies on fuel, CNG is N125 per lcd against N650 for petrol. You guys in La- gos are very lucky. I came from Kano. We have less disposable income than you guys in Lagos but we buy petrol for N620-N630 per litre and you guys buy at N585 per litre.-

Autogas usage as a fuel of choice for the mobility industry globally has risen over 40 per cent

The use of alternative fuel to Premium Motor Spirit (PMS), commonly known as petrol, as well as diesel, continue to dominate discussions in Nigeria, following the removal of subsidy on PMS. In this regard, a major voice in the industry has stated that the drive for LPG usage as autogas will achieve faster results than CNG. With the current state of gas infrastructure in the country, LPG usage as autogas, will achieve faster results than CNG.

LNG usage has better cost implications, even as the current state of gas infrastructure in the country favors faster deployment of LNG and LNG will give longer mileage as autogas. Globally, autogas as a fuel of choice for the mobility sector have risen over 40 per cent. Autogas powers the largest number of vehicles running on alternative fuels. Car manufacturers are switching to direct injection engines that produce substantially lower emissions. In fact, 8 of the 10 largest car manufacturers produce LPG cars. An estimated 2.5 million vehicles in India run on LPG, or autogas, which effectively makes it one of the top five autogas markets in the world in terms of fleet size.

The Energy Commission (EC) of Ghana in 2011 revealed that about 37 per cent of LPG supply to the Ghanaian market is consumed by vehicles while the remaining 63 per cent is consumed by households and others. Another report by the EC of Ghana in 2015 revealed the increasing trend of LPG in the transport sector for commercial vehicles in the year 2000 and 2010.

In the next six months, over 9,000 filling station across Nigeria to be made multi- fuel stations where autogas can be sold

The sad reality is that the moment au- togas fully takes off, many petrol stations might have to close down because a gas registered filling stations in Nigeria are qualified to become multi-fuel stations where vehicle owners could refuel for au- togas, in addition to petrol/diesel refueling as well as serve as charging stations for electric vehicles. Under our NGEP programme, we have what we call the multi-fuel scheme whereby we do not intend to shut down the current petrol stations that we have in the country. We have carried out an audit whereby 9,000 of 10,000 of them qualify to retrofit to become multi-fuel stations.

We have carried out an audit whereby 9,000 of 10,000 of them qualify to retrofit to become multi-fuel stations. Nigerian has major energy security challenges, as oil and gas industry is foreign controlled

Nigeria is not an oil and gas producing country. Nigeria is an oil and gas exporting country. There is a difference because 80 per cent of our production is in the hands of foreigners, less than 10 per cent of what Ni- Nigeria produces in terms of hydrocarbon is actually done by Nigerians. Which means that if IOCs shut down today, Nigeria will have no capacity and does not have the capacity to produce beyond 100,000 barrels of crude oil per day.

That is the major energy security issue. It’s a major national security issue and it happened during Covid-19 in 2020; zero production was experienced in this country, because the expatriate left the country. So, Nigeria is not metaphorically an oil and gas producing country. Nigeria is oil exporting country. We need to understand that, otherwise we are deluding ourselves as being an oil and gas producing country. In fact, Nigeria should exit OPEC and should join oil and gas exporting nations.

Nigeria more of a gas nation than oil, should focus more on gas

Nigeria has always focused on oil production, putting natural gas in the second position, while the country is more en- dowed with gas than oil. There is no part of Nigeria where you don’t have abundant gas deposits. So, as long as Nigeria continues to treat gas as a bi-product that is not needed, something that ought to be exported out of the country, the nation would never move forward.

Looking at the gas resource that the country has, Nigeria’s natural gas should be a catalyst for the nation’s survival and economic rebirth; but the reverse is the case, because we relegated gas to the background. It is the reason why it is imperative for the country to have a National Gas Expansion Programme.

There are areas where you may not find oil. But there is hardly any area where you cannot find gas. That is the gem that God almighty has endowed in our country. As a nation with an ocean of gas, what Nigeria has as reserve in comparison to what it produces is so massive. We are producing infinitesimal gas compared to what we have as reserve. 40 per cent of what we produce is exported in the form of NLG, which means 41 per cent are dedicated for export.

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