Diesel vs piped natural gas: the real cost for Nigerian industry

For most Nigerian factories, diesel generation is the single largest controllable cost on the profit-and-loss account. Piped natural gas typically removes 40 to 55 percent of that fuel cost. This article breaks down where the difference comes from, so you can judge the case for your own facility.

1. The fuel price gap

Diesel (AGO) is a refined, imported liquid fuel whose price moves with the global oil market and the naira exchange rate. Natural gas is produced domestically and priced in a way that is far less exposed to those swings. On an energy-equivalent basis - naira per kilowatt-hour generated - piped natural gas is consistently and substantially cheaper than diesel or heavy fuel oil.

2. The hidden costs of liquid fuel

The pump price of diesel is only part of the story. Running generators on liquid fuel also carries:

• Logistics and haulage. Tanker deliveries, scheduling and the risk of supply interruptions.
• Storage and losses. Tank farms, evaporation and pilferage.
• Maintenance. Diesel engines run dirtier; gas-fired generation typically means longer service intervals and lower wear.

Piped gas arrives continuously by pipeline, is metered at your gate, and removes the tanker queue entirely.

3. Metered, predictable billing

With piped natural gas you pay in arrears for exactly what you consume, measured at a Pressure Regulation and Metering Station on your site. There is no advance fuel purchase tying up working capital, and no guesswork about what a tanker actually delivered.

4. A worked comparison

Take a facility burning 800 litres of diesel a day across 26 working days. That fuel bill alone runs into the tens of millions of naira a month. Cutting it by 40 to 55 percent frees a very large sum every year - which is why the equipment investment in a gas-fired generator or a bi-fuel conversion is usually recovered within months rather than years.

The exact figure depends on your consumption profile, which is why we prepare a site-specific assessment from your verified fuel records before you commit to anything.

How to see your own numbers

Complete the Energy Data Form and our commercial team will model your specific saving at no cost and with no obligation. You can also read more about switching from diesel or how the switch works step by step.