The Nigerian government is taking steps to broaden the use of natural gas within the country, with car owners expected to start fueling their vehicles with gas in the place of premium motor spirit (petrol) starting October.
The introduction of alternative fuel is meant to give the recent deregulation of the downstream sector a “human face” according to the minister of state for petroleum resources. “Gas will now become fuel for our cars and the programme will be rolled out within the next month,” Timipre Sylva said Thursday at a press briefing in Abuja.
Earlier this month, the Department of Petroleum Resources issued a directive to 9,000 filling stations across the country for the installation of facilities for gas products. That is in line with the goal to improve the use of liquefied petroleum gas, compressed natural gas, liquefied natural gas, and autogas as alternative fuels for Nigerians. “If you go to a filling station and you convert your car to dual capability or dual fuel, you will find gas LPG, you find CNG and LNG being sold,” Sylva said.
Natural gas as an alternative also comes with a cost advantage, which the minister was quick to point out. “So, if you look at the price of PMS versus the price of gas, it (gas) is going to be cheaper. Gas will even be cheaper than petrol as it is today,” he said.
Nigeria has one of the largest gas reserves in the world and is a leading West Africa exporter but largely depends on liquid fuels to power transportation and general economic activity.
“We are leading exporters of LNG but what we haven’t seen is a deepening of our domestic gas markets. We need to use gas to displace our current use of diesel… because we have so much of it and it’s cheaper,” West Africa energy expert Olu Verheijen said.
Deploying gas for transportation would also help reduce carbon emissions – CO2 from transport (percentage of total fuel combustion) in Nigeria was 35.4 as of 2014, compared to a world average of 20.4. Natural gas is known to have many qualities that make it an efficient, relatively clean-burning, and economical energy source.
Key to West Africa deepening its domestic gas market is attracting sufficient investment, added Olu in an interview with Ventures Africa, and although it is in “everybody’s interest” to displace high-carbon energy, whether those investment opportunities make sense to private capital is a different conversation around an enabling business environment.