CNG’s Affordability Promise Hits the Infrastructure Test

By Ayo Susan

Nigeria’s push to make Compressed Natural Gas (CNG) a cheaper transportation fuel is confronting its defining constraint: availability. The Presidential Initiative on Compressed Natural Gas and Electric Vehicles ((Pi-CNG/EV)) says building the infrastructure needed to deliver CNG at scale remains a complex, capital-intensive undertaking.

The warning comes as rising global oil prices continue to expose the vulnerability of a transport system heavily dependent on petrol and diesel.

DEVELOPMENT:

Chairman and Chief Executive Officer of Pi-CNG/EV, Mr. Ismaeel Ahmed, said CNG infrastructure must be developed across the entire value chain, from gas production and processing to pipelines, compression, transportation, daughter stations and retail outlets.

“Nigeria has the resources and technology required to develop the CNG industry but the major challenge is to simultaneously create demand and ensure adequate supply,” Ahmed said.

He said government had provided the political backing needed to transform CNG from a largely private-sector initiative into a national project, but stressed that the state could not finance the entire industry.

“Government catalyses. It catalyses on both ends the demand side and the supply side,” he said.

Ahmed said investors must therefore be encouraged to finance infrastructure, while sustained public education addresses misconceptions about CNG safety and helps Nigerians adjust their energy habits.

DATA:

Transportation consumes between 15 percent and 25 percent of household income, depending on location and mode of transport, according to Ahmed.

His strongest illustration came from a vehicle owner travelling between Kano and Karai. A journey that previously required about N300,000 in weekly petrol expenditure reportedly cost about N22,000 after conversion to CNG. The vehicle conversion itself cost about N1.5 million.

The example points to potentially significant operating-cost reductions, but it also exposes the central infrastructure problem. Savings are economically meaningful only when motorists can reliably find CNG.

“Anything that is not available is not affordable. For it to be affordable, it has to be available,” Ahmed said.

SIGNIFICANCE:

For investors, the CNG opportunity is no longer primarily a question of whether Nigeria has sufficient gas resources. It is a question of whether infrastructure can connect supply to paying demand at commercially viable cost.

The required investment stretches across gas processing, pipelines, compression, transportation, land, licensing and filling stations. This creates opportunities for private capital, but also raises execution and coordination risks.

For households and commercial transport operators, the stakes are more immediate. Lower fuel costs will only translate into lower transportation costs if CNG is accessible and the savings ultimately reach passengers.

Ahmed put that social test bluntly: “Your GDP going up or down means nothing to me if the person in the village, town or suburb has not told me that he has seen some movement in his life. That is my economic index.”

NEXT MOVE:

The critical indicators are the pace of CNG station deployment, availability of gas, investment into compression and transportation infrastructure, conversion uptake and whether operating-cost savings begin reaching commercial transport users.

The evolution of the CNG/EV Users Forum is also worth watching as government seeks structured feedback from vehicle owners, commercial and e-hailing drivers, technicians, conversion centres and station operators.

OUR LENS:

Nigeria’s CNG transition is moving from political announcement to infrastructure economics.

The government has established demand-side momentum, but the next phase requires private capital to build the supply network capable of sustaining adoption. The central lesson is therefore simple: Nigeria cannot convert millions of vehicles to CNG faster than it can build the infrastructure to fuel them.

The success of Pi-CNG/EV will ultimately be determined not by the number of conversions announced, but by whether Nigerians can consistently access cheaper energy when and where they need it.

Ayo Susan is a journalist, covering business, society and emerging developments with an emphasis on credible and engaging storytelling.