FG Releases New CNG Pricing Structure as Dangote Moves to Build 100 Filling Stations

• The Nigerian government has launched the implementation of the Compressed Natural Gas Pricing Structure
• The development is meant to regulate pricing, streamline supply, and accelerate the CNG-vehicle transition
• PCNG’s programme director, Michael Oluwagbemi, disclosed in Abuja that the guidelines will regulate the growing autogas market

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

Following the rising need for cheaper fuel, the Nigerian government has launched the Concessionary Autogas Supply and Pricing Framework for Compressed Natural Gas (CNG).

The move is aimed at regulating pricing, streamlining supply, and hastening the transition to CNG-powered mobility nationwide.

CNG will be priced lower than gas

The development is championed by the Presidential Compressed Natural Gas Initiative (PCNG), and it marks a major step in positioning gas as a critical solution to Nigeria’s fuel subsidy removal and clean energy targets.

PCNG’s programme director, Michael Oluwagbemi, disclosed at the Mobility CNG Framework event in Abuja that the guideline will regulate the growing autogas market and prevent abuse of the pricing advantage by the government.

He said that the new pricing structure, which was approved in 2024 by the chief executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed, allows CNG to be priced lower than gas for power generation or industrial use.

According to Oluwagbemi, Nigeria’s auto-CNG landscape has seen exponential growth in the past year.

Dangote to build 100 CNG outlets

The PCNG programme director said that Nigeria now boasts over 65 CNG operation fuelling stations, from 20, while over 28 additional stations are due for commissioning.

He said that two stations owned by BOVAS in Ibadan have begun operation.

He cited Dangote’s plan to add about 100 CNG distribution outlets to those under construction.

Oluwagbemi said the number of gas-powered vehicles has risen from 4,000 to 50,000 nationwide.

The PCNG leader stated that the figure is projected to rise to between 125,000 and 200,000 by the end of 2025.

He explained that queues at CNG stations in Abuja are now a daily occurrence.

FG moves to reduce reliance on petrol

According to him, the government will provide the necessary incentives, like concessionary pricing, to unlock investment and achieve the national target of one million CNG vehicles by 2027.

Chijioke Uzoho, the managing director of Gas Aggregation Company, said that the pricing guideline would enforce regulatory and commercial discipline in the CNG market.

Punch reports that the Concessionary Autogas Supply and Pricing Framework is one of the many measures under the PCNG initiative to reduce Nigeria’s reliance on petrol, cut emissions, and drive industrial growth via strategic use.

The Nigerian government have been aggressive and intentional in positioning CNG as a viable alternative to petrol following the removal of the petrol subsidy.

The government has launched various CNG initiatives, including free conversion centres for commercial and private vehicle owners nationwide.

Places to convert cars to CNG

Legit.ng previously reported that many Nigerians want to start using compressed natural gas for their cars instead of premium motor spirit.

This is because CNG is far cheaper than PMS, which is now highly expensive in Nigeria.

However, some people who want to convert their cars to run on CNG still don't know how to do so.

Source: Legit.ng