Lagos, June 9, 2023 – Some experts have advised Nigerians to turn to gas-powered vehicles as alternative to petrol-powered vehicles due to the current high price of petrol in the country.
The cost of petrol in the country now ranges between N500 and N600 per litre from the old price of N195 per litre since the removal of petrol subsidy on June 1.
Proshares, an investment and market information service company, shared the views of some its analysts in the latest edition of its “Analyst Note”.
“Following the subsidy removal and the subsequent increase in petrol pump prices, analysts have argued that Nigerians need to migrate toward gas-powered vehicles.
“The post-subsidy regime supports a higher petrol price per litre by about 180% and makes CNG and other gas variants, such as LPG, a cost-efficient alternative.
“This realization has compelled the clamour for more investment in CNG-powered vehicles,” it said.
Proshares said the Independent Petroleum Manufacturers Association of Nigeria (IPMAN) had also endorsed using CNG as an alternative energy source to cushion the effect of the petrol subsidy removal.
“A local newspaper report analysed the efficiency of gas-powered vehicles, arguing that a standard cubic meter of CNG sells between N175-N270, which is 30% the price of diesel, and 41% the price of petrol.
“The report also argued that it costs between N200,000 and N300,000 to purchase the kit needed to convert from a petrol or diesel engine to a CNG or LPG engine.
“Analysts believe there are vast opportunities along the gas value chain post-subsidy. But regulatory incentives need to be in place to attract investors,” it advised.
Proshare related commercial exploitation of gas resources, particularly through mass adoption of gas-powered vehicles in Nigeria to gas wastage through flaring.
“A report by the National Oil Spill Detection and Response Agency (NOSDRA) revealed that oil and gas companies operating in Nigeria flared 92.3 million standard cubic feet (mscf) of gas, estimated at N150 billion between January and April 2023,” it said.
Proshares’ experts also agreed that the practice of gas flaring has continued to undermine the prospect of the Nigerian Gas Flare Commercialisation Programme. (GBN)
