FG targets 500 new CNG stations as investors commit $2.6bn

By Chibuzor Alli

The Federal Government is targeting another 500 Compressed Natural Gas (CNG) infrastructure facilities as private investors commit about $2.6bn to expand Nigeria’s alternative fuel market.

The expansion drive comes as the country records approximately 160 operational CNG refuelling stations, with another 170 facilities undergoing development or awaiting regulatory approvals.

The Executive Chairman and Chief Executive Officer of the Presidential Initiative on Compressed Natural Gas and Electric Vehicles, Ismaeel Ahmed, disclosed this on Friday during the commissioning of a CNG Integrated Refuelling Unit in Karu, Abuja.

The facility was established through a partnership involving the State House, Pi-CNG and Electric Vehicles, and Rolling Energy.

Ahmed said the programme had moved beyond its initial adoption phase, with growing private-sector investment demonstrating increasing interest in CNG infrastructure.

He disclosed that President Bola Tinubu had directed another round of infrastructure expansion, with approximately 500 additional units expected through the MDGIF.

He said, “The investors are putting in $2.6bn worth of private investment. Our President has ordered for another round of about 500 infrastructure units to come in through the MDGIF. So I don’t think it’s a proof of concept any longer.

“It’s not the beginning. It’s a scale thing. Nigeria is 220 million people strong, 12 million vehicles. We are moving at a scale that we need to move. The work is in progress. What we need is to fasten up the scale.”

According to him, the additional infrastructure is expected to come on stream between this year and early 2027, while another 170 facilities are at various stages of development and licensing by the Nigerian Midstream and Downstream Petroleum Regulatory Authority.

Ahmed called on more entrepreneurs and private investors to participate in the programme, stressing that expanding the refuelling network was necessary to serve Nigeria’s large vehicle population.

He said, “A lot of entrepreneurs are seeing the need for this, and they are coming in, and we are calling them to come in and invest more.

“It took us 60 years to get to 24,000 PMS stations, and like the Permanent Secretary said, these are all privately owned.”

Beyond infrastructure development, the government says the adoption of CNG-powered buses is already helping to reduce transportation costs on some commercial routes.

Ahmed disclosed that passengers on routes where the buses operate were paying between 30 and 40 per cent less in transport fares.

He cited routes in Abuja, Lagos and Kano, particularly the Kano-Katsina corridor, where commuters previously paid between N3,000 and N4,000 but could now travel for N1,500 using CNG-powered buses.

He said, “It has significantly reduced about 30 per cent to 40 per cent of transportation fees in the routes where CNG buses are ferrying. Our goal now is to extend this to every nook and cranny of where commercial vehicles and their high-traffic corridors. That’s the goal.

“But where it is currently in operation, even in Abuja, in Lagos, in Kano, between Kano and Katsina, that used to take about N3,000, N4,000 to travel, now you take N1,500 for CNG buses that are flying that route.”

The Pi-CNG chief explained that the reductions were established by comparing fares charged by commercial transport operators before and after the introduction of CNG-powered buses on the affected routes.

The initiative forms part of the Federal Government’s efforts to promote natural gas as a cheaper alternative to petrol, particularly following the removal of the fuel subsidy in 2023, which contributed to rising transportation costs.

Despite Nigeria’s substantial natural gas reserves, the country has struggled to maximise the resource, with significant volumes historically lost through gas flaring.

Speaking at the commissioning, the Permanent Secretary, State House, Temitope Peter Fashedemi, said the new facility reflected the government’s commitment to expanding access to alternative transportation fuel and attracting private-sector investment.

He explained that the project involved converting an abandoned petrol dispensing station owned by the State House into a CNG refuelling and vehicle conversion centre.

According to Fashedemi, the State House provided the existing facility, while Rolling Energy financed its rehabilitation and installed the necessary equipment without government expenditure on the project.