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Oando investing N75 billion in the development of gas plants in Nigeria

By on July 28, 2011

The Group Managing Director of Oando Plc, Mr. Wale Tinubu, has said the company is investing a whopping $500 million, an equivalent of N75 billion in the development of gas plants in Nigeria to solve the problem of acute shortage of gas required in the country’s productive sector.

Tinubu who said this in an interactive session with Journalists yesterday in Lagos, explained that Oando Plc, the country’s indigenous energy leading group, was concerned about the set back inadequate supply of gas has brought to manufacturing industries in the country.

He explained that the company was also pumping about 100 million dollars in the development of Liquefied Petroleum Gas (LPG) plants in the country , hinting that a Memorandum of Understanding had been signed with a foreign firm to supply the company five million kilogram cylinder of cooking gas.

The Oando boss explained that the 10, 000 tons capacity LPG plant would have about 8,000 metric tons domiciled in its Apapa terminal where it would distribute it to all its filling plants.

He said availability of gas in the country would solve the twin problems of kerosene price hike and scarcity that have defied solutions proffered by successive governments .

The company is responsible for development, operation and management of Oando Plc’s gas and power businesses which currently include Gaslink Nigeria Limited (GNL), Akute Power Limited (APL), East Horizon Gas Company Limited (EHGC) and other prospective gas and power Special Purpose Vehicles (SPVs) spread across the country.

Tinubu blamed the lingering kerosene scarcity and price hike on monopolistic grip of the Nigerian National Petroleum Corporation (NNPC), pointing out that the unending fluctuations were due to the fact that it was subsidized product.According to him , if the kerosene importation and distribution is liberalized, importers can bring in the product in large quantity and flood the country, saying ,”the fact that many people are selling kerosene and the price is still high underscores the fact that there is short supply of the product.

“If the volume of supply is high and available in abundance, the price would crash. The reason why you do not have fuel scarcity is because 60 per cent of the products is supplied by those in the private sector. In power sector over 50 per cent is supplied by the private sector through generators”.

He urged the government to come up with good policies that would encourage the private sector to embark on the building of private refineries.