Cooking gas: Marketers plan massive imports after 140% price surge

As the prices of Liquefied Petroleum Gas (cooking gas) rise by about 140 per cent in many locations across the country, marketers of the commodity are perfecting plans to massively import the product to make it more affordable and available.

Findings showed that cooking gas prices jumped from an average of N1,000 per kilogramme in January and February this year to as high as N2,400 a few days ago. Industry sources told our correspondent that the regulator is issuing licences for the importation of cooking gas.

This is also because local producers of LPG have been unable to meet domestic demands for gas, according to operators. For example, the sources stated that there is a decline in LPG supply from the Dangote Petroleum Refinery due to internal utilisation, not because the refinery exports, as is being speculated.

“The recent decline in LPG supply from the Dangote refinery, which has created a crisis in the domestic market, isn’t because of exports but is due to their internal utilisation for enhancing petroleum production capacity,” a source familiar with the development, who spoke in confidence due to the lack of authorisation to speak on the matter, stated.

The source further explained that this had to do with the refinery’s recent ramp-up to 700,000 barrels per day amid higher global fuel demand. Consequently, marketers were allowed to bring in enough LPG to end the current scarcity and crash the prices, which have risen from less than N1,000 earlier in the year to about N2,400 per kilogramme.

An official in the Nigerian Midstream and Downstream Petroleum Regulatory Authority, who also spoke in confidence, said, “The regulator is collaborating with the Nigerian National Petroleum Company Limited and other key stakeholders to further boost LPG availability in the local market.”

Speaking in an interview with our correspondent on Sunday, Louis Ibah, who is the spokesman for the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, said marketers have committed to importing larger volumes of LPG.

“Marketers are stepping up their efforts and have committed to importing larger volumes of LPG, ensuring that supply meets demand in the weeks ahead for domestic consumers,” Ibah said.

Ibah assured Nigerians that the gas minister is addressing all issues concerning LPG availability. According to him, the minister has mandated the NMDPRA to work with stakeholders to resolve supply challenges and ensure uninterrupted gas availability for domestic use.

He added that the Dangote refinery had been urged to prioritise the supply of LPG to the local market. “Nigerians should rest assured that the Minister of State Petroleum Resources (Gas), Dr Ekperikpe Ekpo, is actively addressing all issues affecting the production, distribution and supply of LPG in the country.

“The minister has mandated the NMDPRA to work with stakeholders to resolve supply challenges and ensure uninterrupted availability of gas for domestic use. And there is good news as the management of the Dangote refinery has been urged to prioritise and allocate more LPG volumes for the domestic market.

“Marketers are also stepping up their efforts and have committed to importing larger volumes of LPG, ensuring that supply meets demand soon,” he said.

Speaking in an interview with our correspondent, the National President of the Nigerian Association of Liquefied Petroleum Gas Marketers, Edu Inyang, confirmed the development to our correspondent. According to him, the depot owners are planning to ship in cooking gas to end the current scarcity in the country. He said the depot owners confirmed to him that they were planning to import LPG.

“The depot owners have confirmed to us that they are planning to import enough LPG,” he said in a chat with our correspondent on Monday.

Ibah, the gas minister’s aide, had earlier dismissed the claim that local gas producers were shipping out the product, saying the Federal Government’s restriction on LPG exports remains in place and is being enforced by the NMDPRA.

“The ban on exports of LPG announced by the Minister of State for Petroleum Resources (Gas), Dr Ekperikpe Ekpo, is still in place to stabilise prices and is strictly enforced by the NMDPRA,” Ibah told The PUNCH.

He emphasised that none of the local producers is allowed to export cooking gas, saying all resources are focused on making the product available for Nigerians. “It’s important to note that none of our producers are currently exporting the LPG meant for cooking in Nigeria, so all resources are focused on meeting our local needs,” he said.

The government’s position comes as concerns mount over soaring cooking gas prices and supply shortages across several parts of the country. Retailers and consumers have reported difficulties accessing supplies, while prices have continued to rise.

Aside from the rising cost of cooking gas, Nigerians said the product is also not available at retail outlets, forcing many to resort to charcoal and firewood for cooking.

Ibah told our correspondent on Monday that normalcy was returning as far as cooking gas supply is concerned. But retailers countered his claim, stating that they have yet to witness the normalcy, as the commodity was still scarce as of yesterday.