The Federal Government of Nigeria has announced plans to establish around 500 additional Compressed Natural Gas infrastructure facilities nationwide. This move is part of efforts to expand access to alternative transportation fuels and reduce mobility costs. According to the Executive Chairman and Chief Executive Officer of the Presidential Initiative on Compressed Natural Gas and Electric Vehicles, Ismaeel Ahmed, approximately 160 CNG refuelling stations are currently operational, with another 170 facilities under development or awaiting regulatory approvals.
The Presidential Initiative on CNG and Electric Vehicles has made significant progress, with Nigeria’s CNG programme advancing beyond its initial implementation phase. The growing participation of private investors and the increasing number of operational facilities demonstrate the commercial viability of the initiative. Private-sector investors have committed around $2.6bn to developing the country’s CNG infrastructure. President Bola Tinubu has directed another phase of infrastructure development, involving the deployment of approximately 500 additional units through the Midstream and Downstream Gas Infrastructure Fund.
The country currently has about 160 operational CNG refuelling stations, with an additional 170 facilities at various stages of construction, development, and licensing by the Nigerian Midstream and Downstream Petroleum Regulatory Authority. The latest presidential directive is expected to bring more infrastructure into operation between the end of 2026 and early 2027, significantly improving the availability of CNG for vehicle owners and transport operators. This development aims to make CNG more accessible to motorists, commercial transport operators, and other vehicle users nationwide.
Ismaeel Ahmed called on entrepreneurs and private-sector players to take advantage of investment opportunities in the alternative fuel market. He stressed that Nigeria’s population and vehicle numbers required a much faster expansion of refuelling infrastructure. Private investment will remain critical to achieving the government’s target, given the scale of infrastructure required to serve motorists across the country. Ahmed noted that it took 60 years to get to 24,000 PMS stations, and most are privately owned.
The introduction of gas-powered buses has reduced fares by between 30 and 40 per cent on some routes. Transportation corridors in Abuja, Lagos, and Kano have seen commuters benefit from lower fares following the deployment of CNG-powered vehicles. The Kano-Katsina corridor is an example where passengers are paying considerably less for transportation compared to previous fares. This development is part of the Federal Government’s strategy to increase domestic gas utilisation, diversify the country’s transportation energy sources, and reduce the economy’s dependence on petrol.
The Federal Government’s push for alternative transportation fuels comes amid rising mobility costs following the removal of the petrol subsidy in 2023. The policy triggered significant increases in petrol and public transportation costs across the country. Nigeria has historically struggled to maximise the economic benefits of its substantial proven natural gas reserves, with considerable volumes previously wasted through gas flaring. The government is seeking to harness Nigeria’s abundant natural gas resources as a cheaper alternative to petrol, particularly in the transportation sector.
The newly commissioned CNG Integrated Refuelling Unit in Karu, Abuja, reflects the government’s determination to deepen the adoption of CNG and encourage greater private-sector involvement in alternative fuel infrastructure development. The project was delivered through a partnership involving the State House, the Presidential Initiative on CNG and Electric Vehicles, and Rolling Energy. The facility was established by converting an abandoned petrol dispensing station owned by the State House into a CNG refuelling and vehicle conversion facility, executed without direct government expenditure.
Key points
- The Federal Government aims to establish 500 additional CNG facilities.
- 160 CNG refuelling stations are currently operational nationwide.
- Private investors have committed $2.6bn to developing Nigeria’s CNG infrastructure.
