Nigerians are paying more for petrol, diesel than necessary, ignoring cheaper, available alternatives – says energy expert  

Mr. Femi Olafumiloye, the Managing Director and Chief Executive Officer of  Lafbart Innovations & Consulting Ltd, an indigenous automotive solution provider in Nigeria, spoke about the potential of natural gas as an alternative to petrol during an interview with Oredola Adeola, Managing Editor of EnergyDay, on the sideline of the just concluded Ondo Investment Summit, held in Akure. He highlighted that natural gas is cheaper and better for the environment than petrol and also addressed concerns about the safety of using LPG for cooking and CNG as auto fuel, among others. Excerpts 

Why is there so much skepticism about the safety concerns of LPG and CNG as cooking and auto fuels, and is it justifiable?

I have been in the gas industry for a long time, and I understand the reason for the skepticism of the people towards the adoption of Liquified Petroleum Gas (LPG) as fuel for cooking and powering of generating set, as well as the adoption of Compressed Natural Gas (CNG) as an alternative auto fuel in place of petrol and diesel. Meanwhile the apprehension expressed by Nigerians on the adoption of CNG as auto fuel and LPG for generating sets is uncalled for. People should consider the financial and economic benefits of petroleum resources and understand the various risks associated with adoption of gas as an economic fuel. Whereas there is nothing to fear, it is safe, healthy and affordable. Even if people do not believe in it, they should approach people who have invested in it to avoid wasting money on expensive and unhealthy fuel. What Nigerians should also know is that it is more expensive and unhealthier to fuel their cars with petrol. They need to find out real-time benefits from those who have scaled these opportunities.

People can use gas to cook in the kitchen, but they can’t use petrol. It is important to note that petrol is not a safe fuel for indoor use. Petrol is highly flammable and can release toxic fumes when burned, making it a significant safety hazard. Therefore, it is not recommended to use petrol for cooking indoors. However, LPG and CNG are more environmentally friendly options, better for generators, affordable, available, and ideal for consumption. The safety concerns can be addressed, as we can use gas to cook in the kitchen without any issues. We need to educate people about the benefits and safety measures of using LPG.

What is your view about the rate of adoption and penetration of LPG in Ondo state and across the country?

So much campaign has been done in terms of advocating for the switch from firewood and charcoal to cooking gas, especially considering the health and environmental benefits. For instance, we have been working with the Nigeria Gas Expansion Program to speak to our people in Ondo State about the importance of LPG. We understand that more needs to be done, but a lot of people need to be engaged and taken through the process of switching because people believe in what they can see. People need to see the benefits of LPG firsthand before they can adopt it. We are also working with the Engineering Material Development Institute to explore the local production of LPG converters for generators. We are committed to promoting local content and gradually expanding our capabilities.

How much has been done by the private sector in conjunction with the Government to ensure the availability of LPG and CNG for end-users in the state?

Of course, the availability of the gas molecules has been a major challenge, and we acknowledge that more needs to be done in terms of investment in infrastructure and production of the gas molecules to guarantee availability to end-users. However, with the recent removal of petrol subsidies, there is a need for alternative fuels like gas. The government has shown commitment over the years through various initiatives and interventions in the gas sector, which should lead to more investment in CNG plants. We are optimistic that in the coming months or years, the availability of LPG and CNG will improve significantly.

What is your company’s objective about local content in Nigeria, and why are converting kits still not available locally and are mostly imported instead of being manufactured locally?

Our company’s objective is to be sophisticated in local content, and we believe that producing gas kits in Nigeria is a dream that can come to pass. However, it is not achievable at the moment due to the challenges of technology, availability of raw materials, and fabrication tools.

We are currently involved in the Nigeria Gas Expansion Program and linked with the Engineering Material Development Institute (EMDI) to achieve some of these objectives. The reason why gas kits are still mostly imported instead of manufactured locally is due to the challenges mentioned earlier. The technology and raw materials required to manufacture the kits are not yet available locally, and the fabrication tools are also lacking. We believe that we need to crawl before attempting to walk and before we can choose to fly.

We are still working on developing the resources needed to build rubber gaskets, CNG cylinders, seal-lok for CNG fittings, and other components. Some things are possible, but we just need to start from somewhere.  We are committed to being a leading company in the promotion of the Nigerian Oil and Gas Industry Content Development (Local Content Act), enacted to promote indigenous participation in Nigeria’s oil and gas industry, and the company is committed to this objective.

So, what has your company done to scale some of the industry challenges to unlock the full potential of the industry? 

Of course, there are challenges and availability issues that need to be addressed, and we are currently exploring all the various solutions, in partnership with our partners. Many gas and petroleum product marketing companies in Nigeria are also investing in this area, so I believe that in a few months or a year, we should see some progress, perhaps a 30% to 40% improvement.

At Lafbart, we consider ourselves the champions of local content and are committed to developing it. As a bonafide manufacturer of tricycles by the federal government, we have made significant interventions in the medical, agriculture, risk management, and transportation sectors. We also produce four-wheelers for security operatives, which we call the Control. We use a lot of local content in our manufacturing process and transfer knowledge to our employees. We can do a complete knockdown and use all the facilities for jigs, hole spotting, painting, and assembling.

What are your thoughts on the recent developments in Ondo state?

For us, this is a very welcome development. We believe that Ondo state has a lot of untapped potential, and it’s great to see more exposure being given to businesses through investment summits and other initiatives exposing the state to new investors. Many businesses in Ondo state are thriving, and there is an urgent need to provide avenues and channels to showcase these success stories to the world. The potential of Ondo State as a base for huge mineral resources is known globally, but a lot of people are still surprised by the magnitude of human resources that have gone into transforming these resources into huge economic resources.

What are the attractive offers for investors willing to invest in Ondo state?

Ondo state is a gateway to more than 7 states in the South of Nigeria. It is strategically located on the map of the country, and anyone traveling to the Southern, western, eastern, and northern parts of the country must pass through Ondo state. It is a peaceful state with hardworking middle and lower classes of people, making it an ideal place for investors. Once you identify your target market, you can use Ondo State as a launchpad for your business. Economically, Ondo state has a lot of energy resources and a large reserve of raw materials for industrial purposes.