The Federal Roads Maintenance Agency (FERMA) has signed a memorandum of understanding (MOU) to convert all its operational vehicles to run on Compressed Natural Gas (CNG). This MOU sees FERMA joining the Federal Government’s Presidential Compressed Natural Gas Initiative (P-CNGi).
At the signing ceremony on Wednesday, P-CNGi CEO and Programme Director, Michael Oluwagbemi, said the initiative aims to convert all commercial vehicles of the road transport association free of charge.
Oluwagbemi said the initiative will provide ride-hailing companies with a 50 percent subsidy as they upgrade their vehicles. He said the move is aimed at reducing transport costs as CNG is cheaper, cleaner, and more sustainable than fuel.
“The conversion of FERMA’s vehicles will cut costs for the agency for between 40 and 70 percent, and the MOU will be for the first four years and renewable for another four as the framework aims to deepen the collaboration between the two agencies,” Oluwagbemi said.
Oluwagbemi also said the target is to convert more than two million vehicles in collaboration with “our private sector partners who have already begun the process in various centres across the country”.
Emeka Agbasi, Managing Director of FERMA, said the transport agency was the first among Federal Ministries and Agencies (MDAs) to begin converting its operational vehicles to CNG.
This is in line with the Federal Government’s ongoing efforts to reduce administrative costs in the wake of the current economic crisis.
“The cost of premium motor spirit (PMS) and diesel contributed substantially to the recurrent expenditure of the agency with its fleet of vehicles spread across the country,” he said. On April 29, the government announced it would launch the CNG initiative ahead of the first anniversary of President Bola Tinubu’s administration on May 29.
On June 12, the government announced it would subsidize CNG vehicle conversion kits for transport union members, adding that more than 20,000 conversion kits would soon be deployed.
