EletiofeFG Secures Discounted Prices For CNG

FG Secures Discounted Prices For CNG

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The Tinubu-led Federal Government has announced a concessionary gas pricing for mobility Compressed Natural Gas (CNG).

The Director/Chief Executive Officer of the Presidential Compressed Natural Gas Initiative (PCNGI) Michael Oluwagbemi, disclosed this in a statement on Tuesday.

He said the initiative secured the discounted pricing from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) through a letter dated April 20 and sent by its Chief Executive Officer (CEO), Farouk Ahmed.

The PCNGI boss said NMPDRA has designated mobility CNG as a special status, which will serve as a subset of gas-to-commercial (GTC).

Oluwagbemi said this will grant access for CNG to Gas-Based Industry (GBI) pricing categorisation for an initial period of five years, and renewable for another five years, in line with the provisions of the Petroleum Industry Act (PIA) 2021.

Oluwagbemi said the GBI pricing of $1.57 per one million thermal units (MMBtu) is set much lower than ordinary $2.42 and $2.92 for Power and Commercial buyers respectively.

 The statement reads: “The Presidential Committee on Compressed Natural Gas led by Zacch Adedeji had initially requested for strategic gas allocation for Mobility focused Compressed Natural Gas projects, in a form of pricing concession.

“This milestone concession is a significant achievement of the PCNGI collaborative work with NMPDRA.

“This concession is expected to spur investors confidence and commercial activities in the nascent market while promoting government policy aspirations for the sector.

“The PCNGI calls on all stakeholders in the sector to take full advantage of this concessionary pricing model for Mobility CNG, and recommit themselves to the future of a gas driven transportation sector that lowers food and energy inflation, while ensuring a cleaner, cheaper, safer and more reliable energy for powering the economy forward in line with the vision of President Bola Ahmed Tinubu.”

Recall that in May last year, President Bola Tinubu announced plans to roll out CNG buses to cushion the impact of fuel subsidy removal.

After months of planning to roll out 2,700 CNG buses, the government said on Sunday that it will launch the project before May 29, 2024.

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