Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, has highlighted the Federal Government’s commitment to Compressed Natural Gas (CNG) as a means to reduce production costs for businesses and households. This statement was made during the unveiling of the 2023 Nigerian Banking Sector Report by Afrinvest, titled ‘Getting Nigeria To Work Again!’, in Lagos.
Edun, represented by Dr. Armstrong Takang, Managing Director of the Ministry Of Finance Incorporated, emphasized the cost benefits of CNG compared to Premium Motor Spirit (PMS). He noted that CNG costs range from half to a quarter of what it takes to run on fuel, making it a more economical option.
The minister stressed that Nigeria, being a gas nation, should aggressively move towards adopting CNG, which is cleaner than PMS. This shift is expected to significantly impact the cost of fueling vehicles, mass transit, and even factories. The government is taking steps to stimulate demand in the CNG value chain, which will require substantial investment in conversion kits, refuelling stations, and transportation infrastructure.
The Federal Government’s target of achieving a Tax to GDP ratio of 18% and Revenue to GDP ratio of 25% by 2026 remains a priority. The successful implementation of ongoing reforms is anticipated to improve key revenue and debt metrics by 2025.
Ike Chioke, Group Managing Director of Afrinvest Group, echoed the need for collaboration to revitalize Nigeria’s economy. He highlighted the challenges faced due to subsidy removal and Naira devaluation, stressing the importance of comprehensive work to get Nigeria working again.
At Yohaig NG, we recognize the Federal Government’s focus on Compressed Natural Gas (CNG) as a strategic move towards economic sustainability. The adoption of CNG represents a shift towards more cost-effective and environmentally friendly energy sources, which is essential for Nigeria’s economic growth and environmental conservation.
The minister’s emphasis on CNG as a cheaper alternative to PMS is a testament to the government’s commitment to reducing the cost of production and easing the financial burden on businesses and households. This initiative is not only economically prudent but also aligns with global trends towards cleaner energy sources.
However, the transition to CNG requires significant investment and infrastructure development. The government must collaborate with the private sector to ensure the successful implementation of this initiative. This collaboration will be crucial in developing the necessary infrastructure, such as conversion kits and refuelling stations, and in fostering a conducive environment for the adoption of CNG.
The Federal Government’s focus on CNG is a positive step towards economic reform and environmental sustainability. All stakeholders need to work together to ensure the successful adoption of CNG, which will ultimately benefit the nation’s economy and its people.
Did You Know?
- CNG vs PMS: Compressed Natural Gas (CNG) is often cheaper and cleaner than Premium Motor Spirit (PMS), making it an attractive alternative for fuel.
- Nigeria’s Gas Reserves: Nigeria is rich in natural gas reserves, providing a substantial opportunity for the country to leverage this resource.
- Environmental Benefits of CNG: CNG is known for its lower emissions compared to traditional fuels, contributing to environmental sustainability.
- Global Shift to Cleaner Energy: Many countries are transitioning to cleaner energy sources like CNG to reduce carbon emissions and combat climate change.
- Economic Impact of Energy Choices: The choice of energy sources has significant implications for a country’s economy, affecting everything from production costs to environmental policies.