KEY TAKEAWAYS:
- Strategic Shift to Natural Gas: Nigeria is actively transitioning from oil to cleaner energy sources, primarily natural gas (LNG, CNG, LPG), to achieve net-zero emissions by 2060 (7).
- Significant Investment and Infrastructure Development: The CNG sector attracted over $500 million in investments in 2024, with key infrastructure projects like the $2.8 billion Ajaokuta–Kaduna–Kano (AKK) pipeline(4,11).
- Presidential Compressed Natural Gas Initiative (Pi-CNG): The Pi-CNG is a flagship government initiative aimed at converting one million vehicles to CNG by 2027. As of April 2025, over 100,000 vehicles have been converted (1,10).
- Significant Economic and Environmental Benefits: CNG offers substantial cost savings, with a standard cubic meter costing around ₦230 compared to petrol prices (1).
- Overcoming Challenges Through Concerted Efforts: Despite clear advantages, challenges like inadequate infrastructure (e.g., only 53 operational daughter stations and high conversion costs (up to ₦1.6 million per vehicle) persist (1,12).
INTRODUCTION
Nigeria bears the brunt of decades of severe environmental degradation due to its dependency on oil for fuel. Oil spills, a tragic and common occurrence stemming from pipeline vandalism, operational failures, or inadequate infrastructure, have wreaked havoc on ecosystems and shattered livelihoods. Beyond the immediate devastation, carbon emissions from oil-dependent infrastructure contribute significantly to global climate change. This immense environmental toll, compounded by persistent social unrest fueled by resource control disputes and perceived marginalization, underscores an urgent and undeniable need for a new direction. This blog delves into Nigeria’s vital shift towards a promising future fueled by cleaner and more sustainable energy sources.
The Energy Transition Plan
In response to these challenges and a global call for climate action, Nigeria is actively transitioning from its historical reliance on oil to cleaner energy sources, with natural gas playing a pivotal role. This crucial shift is a cornerstone of Nigeria’s commitment to achieving net-zero emissions by 2060, as meticulously outlined in the Nigeria Energy Transition Plan (7).
This ambitious plan is not merely about environmental responsibility; it’s a strategic imperative for the nation’s long-term economic stability and energy security. The plan prioritizes drastically cutting carbon emissions across key sectors: power generation, household cooking, transportation, industry, and the oil & gas sector itself. Simultaneously, it aims to foster sustainable development, alleviate energy poverty, and actively combat climate change. By embracing this transition, Nigeria directly confronts the deeply ingrained environmental and social costs previously associated with its oil production, paving the way for a more resilient and equitable future.
EMBRACING CLEANER ENERGY ALTERNATIVES
Recognizing the urgent need for a strategic shift, Nigeria is actively pursuing cleaner energy alternatives, with a primary focus on its abundant natural gas reserves. Liquefied Natural Gas (LNG), Compressed Natural Gas (CNG), and Liquefied Petroleum Gas (LPG) are emerging as viable pathways to a sustainable energy future. Nigeria boasts abundant natural gas reserves, currently standing at 210.5 trillion cubic feet as of January 1, 2025, with a reserve life index of 93 years (13). This vast resource provides a strong foundation for the transition.
The Presidential Compressed Natural Gas Initiative (Pi-Cng)
The Presidential Compressed Natural Gas Initiative (Pi-CNG) is a cornerstone of Nigeria’s energy transition strategy. Launched with the ambitious goal of converting one million vehicles to CNG by 2027, this initiative has already made significant strides across the nation.
Progress and Investment
As of April 2025, not less than 100,000 vehicles – primarily taxis, buses, and tricycles – had been converted to CNG(1). The number of certified vehicle conversion centers has surged to 242 nationwide as of April 2025, up from just seven previously (1). The Federal Government aims to reach 500 conversion centers by 2025 (6). The CNG sector attracted over $500 million in investments in 2024 (4). While the Pi-CNG initially started with just 11 CNG stations nationwide in May 2024, there are currently 53 operational daughter stations, with investors developing an additional 175 new CNG stations (12).
Key infrastructure projects like the $2.8 billion Ajaokuta–Kaduna–Kano (AKK) pipeline are vital to this transition. As of July 2025, the overall completion of the mainline for the AKK pipeline is 86.05%, with mechanical completion expected by November 2025 (3). This pipeline, designed to transport up to 2.2 billion standard cubic feet of gas daily, will significantly enhance gas distribution across the country, particularly to the northern regions, thereby boosting power generation and industrial growth (11).
THE ADVANTAGES OF A GAS-POWERED FUTURE
The shift to LNG, CNG, and LPG offers a multitude of benefits for Nigeria:
- Environmental Friendliness: These fuels burn significantly cleaner than petrol or diesel. A study indicates that transitioning to CNG could lead to a reduction of approximately 73% in daily CO2 emissions from the transportation sector(8). CNG-powered cars produce 30% fewer greenhouse gases compared to petrol cars (10).
- Cost-Effectiveness: CNG is considerably more affordable. As of April 2025, a standard cubic meter (SCM) of CNG costs approximately ₦230(1). Experts estimate that using CNG cars can save 70% on running expenses compared to petrol cars(10). Commercial transporters report spending as little as ₦12,000 on CNG for a route that previously cost ₦50,000 on petrol (13).
- Energy Security and Independence: By leveraging its vast natural gas reserves, Nigeria can reduce its reliance on imported petroleum products, strengthening the local economy and curbing foreign exchange outflows.
- Economic Opportunities and Job Creation: Investments in gas infrastructure, conversion centers, and related services are creating substantial employment opportunities. The Pi-CNG, for example, has already created over 10,000 direct jobs (13).
CHALLENGES IN ENHANCING ITS ADOPTION
Despite the compelling advantages, Nigeria faces several hurdles in fully realizing its sustainable energy ambitions:
- Inadequate Infrastructure and Distribution Gaps: While progress is being made, a comprehensive and widespread infrastructure for gas transmission, distribution, and refuelling stations is still lacking. As of April 2025, Nigeria has 27 mother stations and 63 daughter stations, with most concentrated in the South-West and South-South regions (1). This uneven distribution leads to limited access and long queues in some areas.
- High Conversion Costs: The upfront cost of converting existing vehicles from petrol or diesel to CNG remains a significant barrier for many individuals and businesses, ranging from ₦900,000 to ₦1.6 million, depending on vehicle specifications(1). This is considerably higher than in peer markets like India, Pakistan, and Egypt (1).
- Policy Implementation and Regulatory Gaps: While recent legislation, such as the Petroleum Industry Act 2021, aims to address policy shortcomings, consistent and transparent implementation is crucial to attract sustained investment and foster confidence.
- Limited Public Awareness and Acceptance: A lack of widespread public awareness regarding the benefits and safety of CNG and LPG contributes to slow adoption. Misconceptions about safety and unfamiliarity with the technology deter potential users.
- Accessibility Challenges: Issues such as inconsistent gas supply in certain regions due to incomplete pipeline projects and limitations on trucking distances for CNG also pose significant accessibility hurdles.
RECOMMENDATION
To accelerate Nigeria’s transition to cleaner energy, several strategic recommendations are vital:
- Strategic Investments in Infrastructure: Increase investments to expand and decentralize gas infrastructure, including transmission, distribution, and refueling stations across all regions of the country.
- Incentives for Conversion: Introduce incentives, such as subsidies or financing options, to reduce the upfront cost of vehicle conversion, particularly for public transport vehicles, to make CNG more accessible and affordable.
- Streamlined Policy Implementation: Ensure consistent and transparent implementation of existing policies and regulations, such as the Petroleum Industry Act 2021, to create a stable and attractive environment for investors.
- Public Awareness Campaigns: Launch comprehensive public awareness campaigns to educate the populace on the economic and environmental benefits, as well as the safety of CNG and LPG, to counter misconceptions and increase adoption.
- Completion of Pipeline Projects: Prioritize and expedite the completion of critical gas pipeline projects like the Ajaokuta–Kaduna–Kano (AKK) pipeline to ensure consistent gas supply and distribution nationwide.
- Research and Development: Invest in research and development to foster local innovation in CNG conversion technology and infrastructure development, potentially reducing costs and improving efficiency.
CONCLUSION
Nigeria’s transition from an oil-dependent economy to one powered by sustainable energy is not just an environmental imperative; it is a strategic necessity for long-term economic stability and energy security. The commitment to natural gas, particularly through initiatives like the Pi-CNG and large-scale infrastructure projects, demonstrates a promising direction.
However, overcoming the existing challenges requires sustained and concerted efforts. Strategic investments in expanding and decentralizing gas infrastructure, introducing incentives to reduce conversion costs (especially for public transport), streamlining policy implementation, and launching comprehensive public awareness campaigns are vital to accelerate this transition. By embracing these cleaner alternatives, Nigeria can mitigate the devastating legacies of oil pollution, foster inclusive economic growth, and position itself as a leader in sustainable energy practices, leaving a healthier, more prosperous nation for generations to come.
- Agusto & Co. (2025, April). From Subsidy Shocks to Sustainable Solutions: Charting Nigeria’s CNG Pathway. Retrieved from https://www.agusto.com/publications/from-subsidy-shocks-to-sustainable-solutions-charting-nigerias-cng-pathway/
- Anyanwu, E. (2014). Swamped with Poverty and Agony: Oil Exploration and Unemployment of the Natives in the Niger Delta. International Journal of Development and Sustainability, 3(2), 335-349.
- Arise News. (2025, July 25). NNPC Targets November for Mechanical Completion Of $2.8bn AKK Gas Pipeline. Retrieved from https://www.arise.tv/nnpc-targets-november-for-mechanical-completion-of-2-8bn-akk-gas-pipeline/
- Businessday NG. (2025, June 2). Nigeria’s CNG initiative attract over $500m investment in 2024 – PCNGI. Retrieved from https://businessday.ng/energy/article/nigerias-cng-initiative-attract-over-500m-investment-in-2024-pcngi/
- Chinedu, C., & Chukwuemeka, N. (2018). Oil Spillage and Heavy Metals Toxicity Risk in the Niger Delta, Nigeria. Journal of Health & Pollution, 8(19), 1-10.
- Daily Trust. (2024, December 19). CNG: FG targets 500 conversion centres by 2025. Retrieved from https://dailytrust.com/cng-fg-targets-500-conversion-centres-by-2025/
- Olaniwunajayi (2025, May 9). Taking Stock of Nigeria’s Energy Transition Process More Than Two Years On. Retrieved from https://www.olaniwunajayi.net/blog/taking-stock-of-nigerias-energy-transition-process-more-than-two-years-on/
- Journal of Energy Research and Reviews. (2025, March 25). Compressed Natural Gas Utilization in Nigeria’s Transport Sector: Fuel Balance, Economics and Environmental Considerations. Retrieved from https://journaljenrr.com/index.php/JENRR/article/download/400/834/611
- Nwankwo, J. C., Onwuemenyi, O. N., & Olatunbosun, S. A. (2017). Community health perspective of gas flaring on communities in Delta region of Nigeria. International Journal of Scientific & Engineering Research, 8(4), 168-176.
- Punch Newspapers. (2024, September 23). CNG saves 70% in vehicle maintenance – Experts. Retrieved from https://punchng.com/cng-saves-70-in-vehicle-maintenance-experts/
- The Nation Newspaper. (2025, July 28). $2.8b AKK gas pipeline ready November https://thenationonlineng.net/2-8b-akk-gas-pipeline-ready-november/
- The Nation Newspaper. (2025, June 3). 175 new CNG stations coming, says Pi-CNG boss. Retrieved from https://thenationonlineng.net/175-new-cng-stations-coming-says-pi-cng-boss/
- THISDAYLIVE. (2025, April 12). Nigeria’s Oil Reserves Hit 37.28 Billion Barrels, Gas 210.54 TCF in 2025. Retrieved from https://www.thisdaylive.com/2025/04/12/nuprc-nigerias-oil-reserves-hit-37-28-billion-barrels-gas-210-54-tcf-in-2025/
- THISDAYLIVE. (2025, June 3). FG: Despite Criticism, CNG Initiative Has Attracted $500m. Retrieved from https://www.thisdaylive.com/2025/06/03/fg-despite-criticism-cng-initiative-has-attracted-500m-created-over-10000-jobs/#:~:text=In%20one%20year%2C%20the%20CNG,of%20some%20of%20those%20investments
- World Bank. (2020). The Impact of Gas Flaring on Child Health in Nigeria. Retrieved from https://documents1.worldbank.org/curated/en/099237508302236581/pdf/IDU0af7dd3f1075cb04fed0a71e0b3a08fb54368
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