In the gas space the country is promoting the use of Compressed Natural Gas (CNG) as a veritable alternative to Premium Motor Spirit (PMS) also called petrol and Automotive Gas Oil (AGO) as mobility fuel.
In this regard, several interventions are being implemented to support the expansion of CNG infrastructure through the Presidential Initiative on CNG, Pi-CNG, the Decade of Gas Program and the MDGIF.
Progressively, auto- CNG infrastructure is being expanded and eventually, most retail outlets would be required to install CNG additions to service the growing number of CNG vehicles nationwide.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) is indeed working closely with all stakeholders to accelerate this much needed CNG expansion.
Indeed the authority is resolute and focused on leveraging regulatory framework for creation of extensive value from the country’s crude oil and gas resources. Its organisational and regulatory mandates, as well as performance targets have been clearly set by the Petroleum Industry Act (PIA) and all other key programs of Government (such as the Decade of Gas program, the Pi-CNG, and others) and the mission is therefore to ensure that it provides outstanding enablers that supports all investments in our sector in the next few years.
Overtly the Authority has shown commitment to strengthen collaborations on implementing safety measures across the midstream and downstream ecosystem to address the concerns of the public on safety of operations in the sector.
In line with the government’s directives and efforts on improving affordability and availability of cooking gas, it has been engaging stakeholders on domestication of LPG produced in-country by producers especially Chevron Nigeria Limited (CNL) and Mobil Producing Nigeria (MPN), similar to NLNG which has domesticated 100 per cent of its Butane production since year 2022. In addition, the NMDPRA is engage stakeholders in the development of domestic LPG pricing framework in order to make the product readily available and affordable to the consumers.
With regards to alliances, the authority is continuing with its quarterly domain specific engagements (DSE) with key stakeholders, and on-demand engagements with other relevant parties to address ongoing and emerging concerns.
There are also unprecedented incentive to attract new investment and promote diversification of Nigeria’s energy portfolio, with fiscal incentives to deepen the penetration of CNG LPG and LNG.
This incentives include waivers on import duties and Value Added Tax on the sale and distribution of LNG, CNG and LPG, as well as associated equipment. Very importantly, this fiscal incentive also cover electric vehicles, to encourage investment in this area as part of our commitment to sustainable energy transition in Nigeria.
NATIONAL ECONOMY gathered that the amount of investments from this initiative, from January till date, is over 500 million US dollars and the launched Presidential CNG initiative specifically aims at creating a CNG ecosystem capable of achieving Nigeria’s objective of transiting to cleaner transportation fuels and easing the impact of the removal of fuel subsidies in Nigeria.
The CNG initiative has so far attracted over 170 $5 million in private investments in addition to government financing.
And today, Nigeria has more than 125 vehicle conversion facilities, up from seven in 2023.
Importantly Nigeria is not overlooking the importance of encouraging clean cooking fuel.
It is estimated that millions of Nigerians particularly women and children, live with a harmful health and environmental effects of cooking with firewood and charcoal.
For them, the very act of cooking becomes a life threatening event.
For these people, government is determined to provide affordable access to clean cooking options by way of gas and these fiscal incentives are designed to achieve this all important goal, which is in line with the United Nations, Sustainable Development Goals (SDG) seven on creating affordable and accessible energy.
New Roadmap Boosts Nigeria’s Effort
Interestingly a fresh roadmap initiative launched by the World Liquid Gas Association (WLGA) is seeking to expand access to clean cooking solutions across Africa by increasing availability of liquefied petroleum gas (LPG).
This move is adding up to the level of encouragement government is seeking to provide for the country.
The “LPG Roadmap for Africa” provides three calls to action for the public and private sectors to achieve full access to clean cooking in sub-Saharan Africa by 2030. They include: establishing clear, enforceable regulatory frameworks to scale the LPG market in the region; implementing a consumer financing and payment plan to overcome economic barriers; and investing in infrastructure and roads to improve storage, distribution and delivery networks in more remote areas.
Today, nearly 2.5 billion people (one-third of the global population) are without access to clean cooking solutions, including over 900 million people in Africa. In remote villages and urban slums, many families resort to traditional biomass fuels like coal, wood and dung, which emit harmful and toxic fumes and contribute to climate emissions and deforestation.
Benefits of African households switching from firewood to LPG as a cooking fuel include, reducing indoor air pollution from particulate matter by 98 per cent – significantly decreasing the number of premature deaths and health conditions caused by household air pollutants, saving 1.2 million hectares of forest per year – equivalent to nearly one-quarter of current global deforestation, while decreasing emissions of black carbon (or soot), a powerful greenhouse gas (GHG), by 117 million tons of CO2 equivalent per year – nearly offsetting Nigeria’s annual CO2 emissions and also decreasing 279 million tons of CO2 per year – roughly equivalent to the annual emissions from mid-sized countries such as Taiwan and Malaysia James Rockall, CEO, World Liquid Gas Association, said: “An equitable, fit-for-purpose transition means empowering marginalised communities by reducing global energy poverty and fostering a more inclusive future where everyone has the opportunity to thrive. Access to clean cooking supplies will increase economic opportunities and standards of living, while reducing carbon emissions and environmental impacts. While the roadmap is an important step forward, the Cooking or Life Africa Task Force will work with stakeholders across the public and private sectors to realise these ambitions.”
Alex Grant, Senior Vice President, Marketing, Midstream and Processing, Equinor, said:,“Equinor is committed to contributing to an energy transition that is just and inclusive and brings about long-term social and economic benefits. The WLGA’s Cooking For Life Africa Task Force ‘LPG Roadmap for Africa’ sets out the important contributions that LPG can make in achieving progress towards these goals.”
Huub Stokman, Managing Director, NNPC Retail Limited, said, “A just transition for Africa requires a reduction in energy poverty alongside emissions reduction. The LPG roadmap, which targets about 60 per cent of the continent’s population without access to clean cooking solutions, will simultaneously address economic, health and environmental challenges across Africa. NNPC Retail Limited is fully committed to the Cooking For Life Africa (CFLA) task force as we jointly collaborate to address regulatory, financial and infrastructure problems; and unlock a cleaner, prosperous future.”
Moussa Diao, CEO, Oryx Energies SA, said, “Our participation in the Cooking For Life Africa Task Force is a testament to our commitment to advancing clean cooking solutions across Africa, in addition to the fact that we’ve been a major LPG player in sub-Saharan Africa for over 20 years with several leading positions in West, East and Southern Africa. Half of Oryx Energies’ investments goes into LPG, with half of that going towards LPG cylinders.
“The continued investment in our company’s LPG capabilities helps address not only the immediate health and environmental concerns but also fosters long-term economic and social benefits. With the support from governments, we bring to local populations a cleaner, reliable, more sustainable and affordable energy.”
Jonathan Fancher, CEO, Petredec Global said, “Every year, 600,000 Africans, primarily women and children, die from indoor air pollution – a preventable tragedy that demands urgent action. At Petredec, we believe LPG is the best solution to Africa’s clean cooking crisis. LPG offers a scalable, affordable, and immediate solution to improve health and the environment.
“As a leading LPG value chain company, Petredec’s superior logistics operations and investment in key LPG infrastructure in the region, reinforce our goal of enhancing security of supply and making LPG more accessible. We are proud to support the Cooking For Life Africa Task Force and the ‘LPG Roadmap for Africa’ to accelerate this vital transition.”
Steven Sels, Chief Operating Officer, SHV Energy, said, “Many households in Africa still rely on traditional cooking fuels like wood and charcoal. Convincing these households to switch to LPG requires significant investment in education, marketing, and infrastructure.”
Biova Agbokou, Vice-President Liquefied Petroleum Gas, TotalEnergies, said, “TotalEnergies aims to impact 100 million people in Africa and India by 2030, investing over $400 million in developing liquefied petroleum gas (LPG) for cooking. By developing access to clean cooking in the regions, TotalEnergies intends to have a positive impact on the environment and on people’s health, while also helping to reduce gender inequalities. With this new ‘LPG Roadmap for Africa’ with our peers, we are activating another lever to reach more end-users.”
Jimmy Bowes, President, Building Products, Worthington Enterprises, said, “This roadmap is a significant step toward achieving sustainable clean energy access across Africa. It provides a comprehensive strategy to enhance the adoption of LPG as a clean cooking fuel. As a leading global supplier of LPG cylinders that are essential for safe and efficient fuel storage and distribution, Worthington Enterprises and its Amtrol-Alfa and Ragasco products will help ensure accessibility for all communities. We are proud of how our industry has come together and believe by executing this roadmap we will have a profound impact on improving public health and environmental outcomes in the region.”
The roadmap was authored by S&P Global Commodity Insights and commissioned by the Cooking For Life Africa Task Force (CFLA), an industry initiative including Amtrol Alfa, Equinor, Hexagon Ragasco, Nigerian National Petroleum Corporation (NNPC), Oryx Energies, Petredec, S&P Global, SHV Energy, and Total Energies
