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Bloomberg
Nigeria is counting on gas-powered vehicles to help it reduce reliance on gasoline and improve its climate credentials while easing the pangs of ending decades of an expensive fuel-subsidy regime.
Energy prices have shot up sharply after the government ended subsidies and the country’s labour unions are threatening a general strike on September 28. After a 60% loss of revenues due to the plunge in oil prices, President Muhammadu Buhari is insisting the decision cannot be reversed.
As a palliative, Africa’s top oil producer is offering a 250 billion naira ($648 million) stimulus package under a National Gas Expansion Program that it hopes will spur the use of gas in transportation as an alternative to gasoline-powered cars, according to the central bank.
Investors can access the fund, which has maximum tenor of 10 years, at interest rates capped at 5% until the end of February next year, and then 9% afterward.
Local consumption is still largely limited by lack of distribution facilities, and a lot of the country’s gas is simply burned off or pumped back into oil wells.