CNG Explosion in Edo: FG Told to Take Action on NIPCO's Dominance
- The CNG gas explosion in Benin, the Edo state capital, recently had continued to generate reactions from concerned Nigerians
- This is to the NIPCO's capability to handle the promotion of the CNG as alternative energy to fuel was being questioned by experts
- Dotun Akingbade, in an exclusive interview with Legit.ng, opined that the government need to limit the role of NIPCO, saying there is no justification for the conversion rights given to the company
The recent CNG gas explosion in Benin City has sparked intense debate among experts. Some have cited the government's heavy reliance on the Nigerian Independent Petroleum Company (NIPCO) as a contributing factor.
The blast at Aduwawa, Ikpoba Hill, has raised concerns about NIPCO's capability to promote Compressed Natural Gas (CNG) as an alternative energy source, especially given Nigeria's rising fuel pump prices.
Source: Twitter
CNG: Akingbade questions NIPCO's competency
Experts like Dotun Akingbade suggest that the government should limit NIPCO's role to managing gas stations only, citing the company's unjustifiable concession rights for conversion. NIPCO has had a close relationship with the federal government since 2007, when it presented its CNG project to the government.
However, Akingbade maintained that NIPCO's stations had faced accusations of undertaking risky conversions and failing to properly inspect vehicles. His statement reads:
"In the same month, FG accorded approval for NIPCO to commence the proposed project at Benin City.
"NIPCO Gas was formed as Joint Venture Company between NIPCO and Nigerian Gas Company Limited (NGC) to implement the CNG project.
"But the company’s stations have been severally accused recently of undertaking risky conversions and fails to inspect vehicles properly."
CNG: Professionals warn against potential monopoly
Additionally, professionals like Salis Umeh warn about NIPCO's potential monopoly and anti-competitive practices. Umeh notes that NIPCO's exclusive dealings with select suppliers, facilitated by the Ministry of Finance, may be shutting out better-established international manufacturers.
This could be a deliberate attempt to keep gas prices low (N230) and dominate the market, leveraging its pioneering agreement with NNPC Gas Marketing Limited.
He said:
"NIPCO’s attempt at monopoly in the CNG sector extends to the sole sourcing it drives to secure with the Ministry of Finance where it only deals with suppliers to the exclusion of internationally well-established manufacturers that are better than those NIPCO is pushing.
"This interplay of prices has limited investments in the CNG sector, and even big players like Greenville and Gas Tech have complained loudly that they cannot invest in the sector due to lack of price parity to drive investments."
NIPCO management speaks on CNG explosion in Edo
Legit.ng earlier reported that a CNG explosion occurred at the NIPCO Gas Ltd.'s Compressed Natural Gas (CNG) station in Benin, the Edo state capital, on Thursday, October 18.
In a statement later in the day, NIPCO explained that the explosion was caused by a fake and substandard CNG cylinder installed in the vehicle.
According to the report, no less than three persons were injured during the explosion, and the company reported the incident to the police.
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Source: Legit.ng
