The Nigerian Federal Government has revealed its intention to lower transportation costs by more than 40 percent by implementing Compressed Natural Gas (CNG) for commercial vehicles.

This initiative was announced at a Memorandum of Understanding signing event in Abuja on Friday, attended by significant stakeholders, including representatives from the National Union of Road Transport Workers from the Itakpe, Adavi, and Ajaokuta train station units, who came together to formalize the agreement.

Michael Oluwagbemi, the Programme Director of the Presidential Compressed Natural Gas Initiative, highlighted the government's dedication to ensuring affordable transportation in light of increasing fuel prices.

“We’re working hard to bring transportation prices down, especially during these challenging times. Mr. President has introduced a great alternative to the fuel petrol problem – Compressed Natural Gas,” he stated.

He announced that, under the new plan, the fares for six eight-passenger vehicles will be reduced from N12,000 to N7,000, while the fares for four-passenger vehicles will decrease from N13,000 to N8,000 for travel from Abuja to Ajaokuta train station.

Oluwagbemi stated, “Specifically, the trip from Itakpe Station to Warri costs N5,000, showcasing the benefits of our infrastructure investments over the past five years. We must continue supporting this progress.

“This represents a significant savings of over 40%. Passengers travelling from Abuja to Ajaokuta Station will greatly benefit Mr President’s intervention.”

The Initiative aims to promote the conversion of current commercial vehicles to Compressed Natural Gas (CNG), offered at a substantial discount of up to 60% compared to prevailing petrol prices.

“The converted vehicles will operate at a significant discount, remain flexible, and run cleaner, cheaper, safer, and more reliably,” Oluwagbemi added.

A total of ten CNG fuel conversion centers have been set up in Abuja, Itakpe, and Ajaokuta, comprising six NNPC stations and two NIPCO stations. Plans for additional stations are underway, with partnerships with Bovas aimed at expanding facilities in Abuja.

The implementation timeline is aggressive, with vehicle inspections anticipated to finish next week, followed by the commencement of conversions soon after.

“With over 100 vehicles applying for conversion, we anticipate a two-to-three-week process,” Oluwagbemi explained.

He guaranteed that nationwide transportation fare reductions would be in place by the end of October, with modified vehicles clearly marked to reflect the lower fares.

This initiative is designed not only to alleviate the financial burden on passengers but also to promote a sustainable transportation framework.

“This is a win-win situation, as transport workers will keep some savings while passing benefits to the Nigerian people. You’re saving the country from bankruptcy by taking on this task,” Oluwagbemi stated.

During the event, the Secretary of the NURTW’s Ajaokuta unit, Mr. Adeyemo Teslim, expressed his sincere appreciation for the fruitful collaboration.

“We believe joining forces will yield multifaceted benefits, which we’re eager to support,” he said, highlighting the need for expanded coverage to enhance accessibility across various regions.

“The agreement also includes an enforcement mechanism to ensure compliance with the new fare structure.

“The NURTW has committed to ensuring compliance with these new rates. If any operator violates the agreed-upon fare, they will reimburse the full installation cost,” Oluwagbemi stated.