Nigeria Aims to Cut Transportation Fares by 40% with Compressed Natural Gas Initiative
The Federal Government of Nigeria has announced a plan to boost compressed natural gas (CNG) infrastructure and reduce transportation fares by over 40%. The initiative was formalized during a Memorandum of Understanding signing ceremony in Abuja, where Programme Director of the Presidential Compressed Natural Gas Initiative, Michael Oluwagbemi, emphasized the government’s commitment to affordable transportation amidst rising fuel prices.
Under the new plan, fares for eight-passenger vehicles will be reduced from N12,000 to N7,000, while fares for four-passenger vehicles will drop from N13,000 to N8,000 for trips from Abuja to Ajaokuta train station. Oluwagbemi noted that the trip from Itakpe Station to Warri costs N5,000, showcasing the benefits of the government’s infrastructure investments over the past five years.
The initiative aims to provide immediate financial relief to passengers and encourages the conversion of existing commercial vehicles to CNG, which is sold at a discount of up to 60% compared to petrol prices. Oluwagbemi stated that the converted vehicles will operate at a significant discount, remain flexible, and run cleaner, cheaper, safer, and more reliably.
Transportation fare reductions are expected to be implemented nationally by the end of October, with converted vehicles prominently labelled to indicate reduced fares. The National Union of Road Transport Workers (NURTW) has committed to ensuring compliance with the new rates, and any operator violating the agreed-upon fare will reimburse the full installation cost.
The Secretary of the NURTW’s Ajaokuta unit, Adeyemo Teslim, expressed gratitude for the collaboration, stating that the partnership will yield multifaceted benefits. He highlighted the need for expanded coverage to enhance accessibility across various regions.
To facilitate the transition, 10 CNG fuel conversion centres have already been established between Abuja, Itakpe, and Ajaokuta, including six stations operated by the Nigerian National Petroleum Corporation and two by NIPCO. Greenville is set to inaugurate 17 additional refuelling stations across Nigeria by year-end, with partnerships being formed with Matrix Energy to establish five new stations in Delta and Abuja.
Vehicle inspections are expected to conclude next week, and conversions are set to commence shortly thereafter. With over 100 vehicles applying for conversion, the process is anticipated to take two to three weeks.
