Oil prices rise on account of JMMC 107% output cut compliance
Oil money

As Obasanjo, NLPGA, NLNG harp on LPG sufficiency

By Udeme Akpan, Energy Editor

THE price of Nigeria’s Bonny Light, has risen year-on-year, YoY, by 70 per cent to $115.07 in May 2022, from $67.61 per barrel in the corresponding period of 2021, according to the Organisation of Petroleum Exporting Countries, OPEC.

In its June 2022 Monthly Oil Market Report, MOMR, obtained by Energy Vanguard, the organisation also disclosed that on month-on-month, MoM, the price of the crude increased by 8 per cent to $115.07, from $106.39 in April 2022.

However, investigation by Energy Vanguard, indicated that the development, driven mainly by the Ukraine war and ban on Russian oil, has culminated in the high prices of petroleum products, which the nation imports from the global market.

Cooking gas supply inadequate, price rises further

Meanwhile, investigation by Energy Vanguard indicated that the price of the Liquefied Petroleum Gas, LPG, otherwise known as cooking gas continues to rise, due mainly to high demand and limited supply.

For instance, it indicated that the price of 12.5 kg has increased by 100 per cent to N12, 000, from N6, 000, a few years ago.

Obasanjo, NLPGA react

However, speaking at the just-concluded 2nd West Africa LPG Expo and NLPGA Summit in Lagos, former president Olusegun Obasanjo, who commended the Nigeria LNG Limited for dedicating 100 per cent of its output to the domestic market, called for increased production, massive infrastructural development and removal of the value added tax, VAT, currently affecting demand.

Reflecting on the government policies, he said: “The government under my leadership saw the Nigerian Gas Master Plan as a major interventionist concept to move the gas sector from its essentially dormant status in 2006 to a market-based system with willing sellers and willing buyers, realising the full potential of the sector for the benefit of all Nigerians.”

Also speaking, President, Nigeria Liquefied Petroleum Gas Association (NLPGA), Mr. Nuhu Yakubu, said: “This year is, however, more profoundly important for players in the LPG industry as it marks the 15th year of the commencement of the Nigeria LNG (NLNG’s) intervention in domestic Liquefied Petroleum Gas (LPG) supply, otherwise known as cooking gas, with its Domestic LPG (DLPG) Scheme. 

This scheme has made the most significant impact on domestic LPG supply. It has catalyzed reduction in household energy poverty with reduction in the use of dirty fuel sources for cooking. It has also stimulated growth in the industry, through its multiplier effect, positive impact on forward and backward linkage businesses with massive infrastructure build out that is currently experienced across the value chain today.

“To ensure a steady supply of products, deliveries are made with NLNG’s dedicated vessel to all NLNG’s approved domestic receiving terminals in Nigeria. The company has recently announced that it is dedicating 100 per cent of its LPG production to domestic market, as well as commenced deliveries of propane into the domestic market since 2021. With huge LPG production and supply prospects from its recent commencement of the LNG Train 7 project, clearly NLNG’s LPG supply intervention remains Nigeria’s most significant domestic energy policy.”

Why we dedicate 100% output to domestic market — NLNG 

Similarly, the Deputy Managing Director, Nigeria LNG Limited (NLNG), Mr. Olalekan Ogunleye, stated that NLNG remained committed to collaborating with regulators, partners, and industry players to grow the domestic LPG market and bring cleaner energy to Nigerians.

He added that through the supply of LPG, NLNG prioritized the supply of clean energy in Nigeria while working collaboratively with the government to grow LPG consumption in Nigeria as part of the national journey to a clean energy future.

Ogunleye said: “Since the start of the Domestic LPG Supply Scheme in 2007, NLNG has consistently increased both its reserved volumes for the domestic market and actual LPG volumes supplied. NLNG intends to maintain this steady growth and supply contribution to the domestic market, in consonance with its vision of “helping to build a better Nigeria.

“Deliveries continue to be made through NLNG’s chartered LPG Vessel, entirely dedicated to delivering the product to Nigeria to underpin the scheme and ensure a steady supply of products without disruption.”

“NLNG continues to invest in supply logistics, infrastructure and security to ensure product supply. It has made financial contributions towards refurbishing LPG receiving terminals in Lagos. By so doing, it has made a significant economic impact on business development and the creation of employment opportunities.”

Market forecast

However, the National President, Oil and Gas Service Providers Association of Nigeria, OGSPAN, Maxi Colman Obasi, said: “The NLNG has tried its best to supply the domestic market with LPG. With emphasis on energy transition, there is a great need for other private investors to invest, produce, process and deliver adequate cooking gas to Nigerians. This will go a long way to reducing dependence on imported LPG.”

Subscribe for latest Videos

Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.