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Vehicle Gas: When Possibility Limits Opportunity

Vehicle Gas: When Possibility Limits Opportunity

If the country had accelerated the conversion of vehicles to gas, surely the rise in fuel prices would not be so penalizing. It is still opportune to do so, but there is no money. Even so, the Government “dreams high” and promises changes already in the next year.

The Government needs at least 30 million dollars to install Natural Gas Vehicle (NGV) filling stations along the entire National Road Number 1 (N1). At the moment it only has five million, and even without any idea of where to get the remaining 25 million, the Executive promises that it will meet the target by 2026.

How did this story begin? In 2008, to lessen the impact of the sharp rise in the price of fossil fuels, the Government decided to introduce vehicular gas. The strategic plan was that in ten years, up to 2018, up to 40,000 vehicles would be transformed to run on gas. In that period, 70 filling stations with national coverage were planned.

Only 3000 vehicles were converted in 14 years, a number much lower than the 40 thousand that had been projected until 2018, four years ago.

But today, the number of users of this alternative is around 3,000 vehicles and only six filling stations, with a seventh station soon to be opened in Marracuene district, all with an accumulated capacity of around 7,000 vehicles. In other words, in addition to not having seen the evolution that was expected, there is still a lot of installed capacity to be exploited.

In an interview with E&M two months ago, João das Neves, executive director of Autogás, the company responsible for the vehicle conversion project, assumed that the initial strategic plan was “very optimistic” and that it was necessary to continue running in search of speed.

In the same vein, the national director of Hydrocarbons and Fuels, Moisés Paulino, in an interview with E&M, says it is time to extend the project beyond Maputo City and Province.

“We want to expand this infrastructure along the N1, in a first phase, and in the second phase, in all provincial and district headquarters to give Mozambicans and the economy the opportunity to have alternative fuel,” revealed the national director of Hydrocarbons and Fuels. For that to be possible, the Government, through the Ministry of Mineral Resources and Energy, needs resources. It is about US$30 million. At the moment there is a guarantee of just “US$5 million, which is deposited at the National Investment Bank (BNI) and we are going to use those funds, which are Government funds, with the co-participation of Sasol. We’re going to build natural gas filling stations in Manhiça, Xai-Xai, Maxixe and Vilanculos,” he said.

The expansion of natural gas filling stations will not be an isolated measure. “We are going to build conversion centres for vehicles to use gas. The idea is that drivers leave Maputo for Inhambane, for example, with the guarantee that along the way they will have somewhere to refuel,” he added. The National Directorate of Hydrocarbons and Fuels said it was promoting the initiative and “there are partners who are interested in supporting it. In addition, “we are going to work with the South Koreans, who have great experience in the business of using vehicular gas. We are also trying to raise more funds to make this project move forward quickly,” said Paulino, adding that if all the projections were to come true, “in the next shocks to the supply of fuel on the international market we will already have an alternative that will minimise the impact of price rises. The economy will not be held hostage, as it is today, to gasoline and diesel”.

How much does vehicular gas cost?

The costs of Vehicular Natural Gas begin with the assembly of the filling station itself. Building it from scratch costs around $1 million, but to save on costs, the Ministry of Mineral Resources and Energy is using a strategy. “What we do is use the existing filling stations, which are from the National Energy Fund (FUNAE) and Petromoc, to attach our infrastructure. Using this method, we will spend about $700,000. This will be easier because along the N1 we have many of these establishments,” explained the National Director for Hydrocarbons and Fuels.

But it is not only here that the expenses with vehicular gas end. So that the driver can use this alternative, he has to make some investments in the conversion of his vehicle.

For example, “a conversion kit for a light vehicle is between 49 thousand and 75 thousand meticais. For a minibus, it’s between 65 thousand and 120 thousand meticais. Converting a bus costs approximately 250 thousand meticais. The construction of a conversion centre, including its accessories, costs around 460 thousand dollars (almost 30 million meticais at the current exchange rate).

Moisés Paulino recognises that conversion prices are very high and explains the Executive’s strategy to attract more drivers to opt for natural gas, especially public passenger transport. “These are the costs that we capture in the market, but, with this fund, our idea is to manage them in a way that more or less meets the needs of the citizen. So, we are going to reduce these values to make them more attractive.

Currently the country has only six gas filling stations, so its expansion will require the creation of many others

If a person wants to convert his vehicle, he does not have to think, for example, of spending 49 thousand meticais. They will have to think about the 30 thousand or 20 thousand meticais, which are much more affordable through periodic savings. The same rule is valid for all vehicle categories”, clarified the source.

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Everything can change as of 2023

The money available [to install Natural Gas Vehicle (NGV) filling stations], as we have already mentioned, is only five million dollars. The Ministry of Mineral Resources and Energy believes that, in a favourable scenario, it needs $30 million. So, the deficit to be considered, at present, is around 25 million. Still, the dream speaks louder.

“By the first half of 2023 we will reach Vilanculos, in Inhambane. In the second semester, the drivers that convert their vehicles will be able to leave Maputo safe, as we will have fueling stations in Maputo, the city and province, Gaza and Inhambane,” promised the Director of Hydrocarbons and Fuels.

But the government’s vision is not limited to the south of the country. Next year, “if we manage to reach Sofala, it would be a success. We want to attack the city of Beira and gradually move northwards.

The current international scenario of rising fuel prices should serve as a driver for the project, but its peak will really be in 2025 or 2026. “In this period, we want to close the entire N1. We will be in Pemba and, if possible, also in Niassa. This will help not only the passengers and carriers, but also the economy itself,” he said.

In terms of the number of fueling stations to be installed, Paulino explained that the fact that a car powered by gas can cover between 200 and 250 kilometres means that for every 200 kilometres there has to be a fueling station.

The national director for Hydrocarbons and Fuels also said that, after the Government’s promotion of the campaign, it may be fuel entrepreneurs who take on the business.



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