Nigeria is turning to natural gas as transport costs rise after the removal of fuel subsidies

ABUJA, Nigeria (AP) – When Nigerian President Bola Tinubu ended a costly subsidy that made gasoline affordable for many in Africa's most populous country, Ahmed Halilu knew his e-hailing cab business in the capital, Abuja, was about to face a loss. great. .

Transport costs have soared as fuel prices tripled in the months following last year's ruling, creating the country's worst cost of living crisis. That meant a big drop in Halilu's ridership and ultimately his earnings.

In what they say will eventually reduce transport costs by around 50%, Nigerian authorities in August launched a compressed natural gas (CNG) program to tap its huge natural gas reserves – the largest in Africa – and phase out CNG buses while replacing petrol-powered vehicles to use them. it.

More than 100,000 vehicles have been converted to run on CNG or with a hybrid option of CNG and gasoline, and at least $200 million has been invested by the government under this program, according to its director, Michael Oluwagbemi.

The government aims to convert one million of Nigeria's more than 11 million vehicles over the next three years, but analysts say the plan is slow, pointing to poor use and limited infrastructure.

Although Nigeria is one of Africa's leading oil producers, it is dependent on imported refined oil products because its refineries are struggling, with production at its lowest level in decades amid massive oil theft.

In conjunction with other reforms introduced by Tinubu after coming to power in May last year, the removal of subsidies was supposed to save the government money and stem the decline in foreign investment.

However, it affects the price of everything, and the rising cost of transportation forces people to leave their cars for work.

Switching to electricity is difficult. In addition to the lack of an adequate network of CNG conversion and filling stations – located in 13 of Nigeria's 36 states – the success of the government's program is also limited by low public awareness.

That left room for misinformation and doubt among drivers.

“People don't care about it because of a misunderstanding.” He converted his car and now saves $240 a month in fuel costs from his e-hailing business.

Some drivers have expressed fears that their cars could explode with the CNG conversion – claims that regulatory bodies have said are untrue unless the equipment is installed incorrectly. In the southern state of Edo, authorities discovered that the CNG powered vehicle that exploded had been operated by an unauthorized dealer.

Even in Abuja and the economic hub of Lagos, filling stations are scarce and the few workshops available are often occupied by commercial vehicles waiting for days to switch to CNG at subsidized rates.

Meanwhile, the replacement cost of private cars is 20 times the Nigerian minimum monthly wage of $42.

His colleague had to travel about 200 kilometers (124 miles) to Abuja to fill the cylinder, said Abdul Manasseh, a taxi driver in Abuja.

Another challenge that has slowed the project is Nigeria's limited gas pipeline, making it difficult to supply the stations. As a result, many parts of the northern and eastern regions have not been reached.

The challenges are similar to those of the transition to electric vehicles in Nigeria, where adoption by private operators has been slow. Electricity supply is still inadequate for most of the country's 210 million inhabitants, largely due to underinvestment and destruction of property.

The government understands there is still a lot of “uncertainty” about the CNG program and is working to correct misconceptions and provide the necessary infrastructure, said Tosin Coker, head of commercial affairs.

“CNG is a clean fuel, it is a cheap fuel and it is a safe fuel compared to the fuel we are used to,” said Coker.

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