The Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) has appealed to the Federal Government to urgently intervene in arresting the galloping hike in the prices of Liquefied Petroleum Gas (LPG), also known as cooking gas, across the country.
NALPGAM made the appeal in an open letter jointly signed by its executive secretary, Bassey Essien, and its national public relations officer, Raphael Aguele, and addressed to Timipre Sylva, Minister of State for Petroleum Resources.
NALPGAM appealed to the government to put in place a policy that would encourage the full domestication of LPG.
The marketers said every local producer of gas should be mandated to domicile all molecules produced in the country as against the situation of being a major exporter of gas produced as well as a major importer of gas.
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“If all molecule of gas produced should be domesticated, the local markets will be adequately supplied and prices stabilised.
“By this way, the concerted efforts of the Federal and State government agencies to encourage the use of gas would not be in vain.
“Thus we urge your urgent intervention to address the plight of stakeholders; else all the expansion programme of the government would be an exercise in futility,” NALPGAM said.
The marketers noted that the government in line with its aspiration to deepen gas utilisation in Nigeria had urged investors to harness investment opportunities in the entire gas value chain to bridge the gap in other domestic gas usages in the country.
They said the significant growth in local consumption of LPG had been hinged on many Nigerians converting to cooking gas for domestic and commercial uses.
According to NALPGAM, the country’s local consumption which hitherto stood at about 70,000 metric tons as of 2007 had grown to over one million metric tons as at end of 2020.
“A major challenge with the LPG utilisation in Nigeria is the issue of inconsistent availability and ever galloping gas price with the attendant depot landing costs and other associated charges.
“The domestic availability has been skewed majorly to 65 per cent import dependence while only 35 per cent has been attributed to local supply. The price of LPG has exponentially skyrocketed over the last few months,” they said.
The cost of LPG early in 2020 was N3.4 million per 20MT truck, but by December 2020, it had gone up to N5.4 million; N5.6 million in January 2021 and N6 million per 20 MT by February 2021.
“The galloping price increases have not only choked marketers but have also strangulated consumers, thus making a mockery of the whole gas expansion plan of the government,” the marketers said.
They noted that the gains made in the huge conversion rate to LPG usage which had moved the per capita consumption from 1.5kg to over 3kg have gradually reduced because of the domestic costs of LPG.
The marketers said a majority of users of LPG were gradually reverting to the use of kerosene and firewood with the obvious known health implications.
NALPGAM also alleged that LPG operations at the Nigerian Petroleum Development Company (NPDC Oredo IGHF Plant), Ologbo, Edo State were dominated by “middlemen”.
“These middlemen without identifiable LPG bottling plants are hawking LPG allocations from plant to plant for patronage at exorbitant prices.
“Equally disturbing is the fact that gas plant owners in the Edo/Delta region with their verifiable large storage capacities have not been granted any offtaker facility despite the location of the project in the region,” they said.
