In a bid to speed up the use of Compressed Natural Gas, CNG, by commercial transporters, the Federal Government disclosed that members of the transport union would be provided with free conversion kits and free installation fee.
The government said all transport owners belonging to the National Union of Road Transport Workers, NURTW, National Union of Road Transport Owners, NATO and Road Transport Employers Association of Nigeria, RETEAN, would benefit from the scheme through their unions.
Speaking at the signing of an agreement with five CNG kit conversion companies in Abuja, the Programme Director, Presidential Compressed Natural Gas Initiative, PCNI, Engr. Michael Oluwagbemi said the government expects the cost of transportation to drop by about 50 percent over time.
The firms are Portland Gas, NIPCO, ABG Oil and Gas, Fix it 45, and NITT.
The ceremony also included the NURTW and e-hailing company, Bolt. The government said transport companies and e-hailing companies would get the conversion kits at 50 percent discount. The cost of each kit costs between N1.2 to N1.5 million.
Oluwagbemi explained that the government has identified 123 kit conversion centres across the country, saying the Conversion Incentive programme would be financed from the palliative fund set up by President Bola Tinubu.
He said: “The Conversion Incentive Programme is tackling the barrier to Nigerian commercial transport entities, operators, to convert from PMS to gas. Most of them have said that the cost of conversion is expensive. And so what we are doing here today is basically to respond to that concern. What is the government doing about it? First and foremost, for commercial operators that are unionized, I talk about the members of RETEAN, NATO, NURTW, through their unions, they can benefit from almost 100 percent discount. That is, they will get the kit for free, and installation will also be done for them for free.
“And this is going to be done through these certified conversion workshops that we are beginning to identify. We’ve identified about 123 of them. Five of them are here with us today that we’re going to be working with here in Abuja. As we expand across the country, we’ll be activating more of them at a time.
“The second are ride-share operators. So if you are a vehicle that is operating under Uber, Bolt, LagRide, Move, among the many different operators that we have in Nigeria today, you’ll be able to benefit also from this programme. You will be able to benefit from a 50 percent write-off on the equipment, and then you’ll get the installation for free.
“So that means the government will pay for these conversion workshops. To install the equipment, you’ll get a 50% discount. And because of the arrangement we have with these companies, you’ll also be able to also get to pay little by little, so you’re not paying any money upfront on day one”.
Oluwagbemi said the government has 20,000 conversion kits in stock and targets to convert about 300,000 vehicles annually.
Speaking at the event, Mr. Mohammed Bawa, ABG Oil and Gas, Comrade Aliyu Isa Ore, Acting President, NURTW, and Zankyams Duniya of Bolt, thanked the Federal Government for the support, saying the programme would significantly reduce the cost of transportation.
Bawa noted that with the switch to CNG “transportation (cost) should come down by almost 50 percent in the very near future. We believe that not only will transportation costs come down but also the price of food stuffs will come down considerably because transport cost is a major factor in the rising price of food”.
