Nigeria’s CNG Supply Could Soon Outpace Petrol as Gas Adoption Accelerates

Nigeria’s CNG adoption accelerates

Nigeria’s supply of compressed natural gas (CNG) could soon surpass petrol availability as the Federal Government expands gas infrastructure and accelerates vehicle conversions across the country.

Executive Chairman of the Presidential Initiative on Compressed Natural Gas and Electric Vehicles (PiCNG), Ismaeel Ahmed, disclosed this during an interview on ARISE News, saying the country has recorded significant growth in CNG adoption since 2023.

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Nigeria now has 96 CNG refuelling stations, more than 400 conversion centres and about 120,000 vehicles converted to run on CNG, according to Ahmed.

CNG Adoption Accelerates Across Nigeria

Ahmed said Nigeria had fewer than 10 CNG refuelling stations, about five conversion centres and just over 100 converted vehicles in 2023.

The rapid expansion over the past three years, he said, has positioned the country among the markets experiencing significant growth in CNG adoption.

The next phase of the programme will focus on expanding the scale of adoption and ensuring that the benefits of cheaper fuel reach passengers rather than remaining primarily with transport operators.

Ahmed said transport operators could save between 60 and 70 per cent on fuel costs by switching to CNG, arguing that part of those savings should ultimately translate into lower fares for commuters.

Government Targets Wider Shift From Petrol and Diesel

Ahmed also advocated a broader transition away from petrol and diesel, particularly for commercial transportation.

He suggested that the government should consider making CNG or electric power mandatory for commercial vehicles as the country expands alternatives to conventional petroleum fuels.

Nigeria has about 12 million vehicles, according to Ahmed, with commercial vehicles estimated to account for between 55 and 60 per cent of the total.

The scale of the commercial transport market therefore provides significant potential for CNG adoption to reduce dependence on petrol and diesel while increasing demand for domestic natural gas.

Infrastructure Expansion Remains Critical

The growth of CNG adoption will depend heavily on the expansion of supporting infrastructure.

Ahmed said the number of refuelling stations had increased from about three or four in 2023 to 96, with much of the expansion driven by private-sector investment.

However, he noted that a wider CNG network requires more than refuelling stations. Gas sources, pipelines, compression facilities and other supporting infrastructure must also expand to ensure adequate and reliable supply.

The government is therefore moving from the initial stage of demonstrating the viability of CNG to a larger-scale deployment strategy.

Ahmed described the next phase as a focus on scale, saying demand for conversions is increasing as more motorists adopt the fuel.

Lower Transport Costs Could Support Housing Delivery

For Nigeria’s housing and construction sectors, the expansion of CNG infrastructure could have implications beyond passenger transportation.

Construction depends heavily on road-based logistics to move cement, steel, aggregates, blocks, equipment and other materials between suppliers and development sites.

If CNG significantly lowers fuel expenses for commercial transport and haulage operators, it could eventually reduce some logistics costs associated with construction and property development.

However, the extent of any benefit will depend on the availability and reliability of CNG refuelling infrastructure, the number of commercial vehicles converted and whether lower operating costs translate into lower transportation charges.

CNG Could Influence Construction and Property Costs

Lower energy and transportation costs could improve the economics of housing projects, particularly developments that depend on frequent movement of materials over long distances.

For developers, reduced logistics expenses could create additional room to manage rising construction costs and protect project margins. For buyers, sustained reductions in transportation and operating costs could also provide some relief to household budgets.

The impact would not be immediate, however. Nigeria would need a sufficiently large CNG network, reliable gas supply and widespread vehicle conversion before the cost benefits become substantial across the construction and property sectors.

Safety and Standards Remain Important

Ahmed also urged motorists to use only approved conversion centres and certified CNG conversion kits.

He warned against roadside conversions and the use of liquefied petroleum gas cylinders for CNG vehicles, stressing that motorists should use conversion centres approved by the National Automotive Design and Development Council and kits certified by the Standards Organisation of Nigeria.

As adoption expands, maintaining conversion standards and safety regulations will be critical to preventing accidents and sustaining public confidence in the programme.

Nigeria’s Gas Resources Could Support Energy Transition

Ahmed argued that natural gas should play a larger role in Nigeria’s domestic transportation system, allowing the country to reduce its dependence on petrol and diesel while making greater use of its gas resources.

A wider shift towards CNG could also reduce Nigeria’s exposure to international oil-price fluctuations, particularly if domestic gas supply and distribution infrastructure continue to expand.

For the property sector, the longer-term significance lies in whether cheaper and more reliable energy can translate into lower development and operating costs across Nigeria’s rapidly growing urban centres.

Outlook

Nigeria’s expansion of CNG infrastructure marks a significant shift in the country’s energy and transportation landscape, with 120,000 vehicles already converted and the number of refuelling stations continuing to grow.

If supply eventually outpaces petrol availability as projected by Ahmed, CNG could become a much more prominent component of Nigeria’s transport system.

For housing and real estate, the key question will be whether the benefits extend beyond vehicle operators to reduce logistics, construction and household transportation costs. A broader reduction in energy-related expenses could strengthen the economics of housing delivery, but this will depend on the pace of infrastructure expansion, vehicle conversion and the ability of lower fuel costs to filter through the wider economy.

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