Photo File: Chief Executive Officer and Programme Director of the Presidential Compressed Natural Gas Initiative, Michael Oluwagbemi

The cost of Compressed Natural Gas (CNG) has surged from N230 to N450 per standard cubic metre (SCM) following a recent review by the Federal Government, sparking concerns among motorists and transport operators.

Our correspondent gathered from retailers that the government has reduced subsidies on CNG. While trucks now pay the full price of N450/SCM, private cars and commercial drivers still enjoy partial subsidies, paying N380/SCM.

The new pricing structure was confirmed by an official of the Presidential Compressed Natural Gas Initiative (PCNGI), who explained that commercial drivers pay less to prevent a sharp increase in transport fares. “The refuelling stations now sell at different prices for cars and trucks. The subsidy is targeted at commercial vehicles,” the source said.

Beyond pricing, the official stressed that PCNGI’s main focus is to expand access to CNG refuelling stations nationwide. “Some have converted their vehicles but still rely on petrol due to limited gas availability. We are working to increase the number of CNG stations to address this challenge,” he added.

A major retailer confirmed that NNPC Gas Marketing Limited reviewed the prices, noting that the government had capped CNG prices below cost since petrol subsidies were removed in 2023. He warned that prices may climb to N500 or N600/SCM soon to attract investors.

Some motorists fear the increases and persistent long queues may undermine the CNG adoption drive. “Many of us spent up to N1.5m converting our cars. Now with prices rising and queues stretching over a kilometre, people may return to petrol,” said Adeyemi Paul, a ride-hailing driver.

Efforts to reach officials at the Ministry of Petroleum Resources (Gas) and the NNPC for comment were unsuccessful.

When President Bola Tinubu removed fuel subsidies in May 2023, petrol prices jumped from N175 to N870 per litre, prompting the government to promote CNG as a cheaper alternative. The initiative has since recorded growth, with over 100,000 vehicles converted to CNG in one year, up from fewer than 4,000 previously.

According to PCNGI Programme Director Michael Oluwagbemi, the country now has 265 conversion centres, 60 operational refuelling stations, and more than 10,000 new direct jobs created. An additional 100 refuelling stations are expected to be commissioned in the coming months.

However, the latest price hike has raised doubts about whether CNG can remain a viable alternative to petrol and diesel.