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No plan to reduce cooking gas price — Marketers

By BusinessNews Staff on June 30, 2014

Hope for a reduction in the price of cooking gas may have been dashed as marketers of the commodity say they have no plan to cut the price anytime soon.

According to them, the current cost of Liquified Petroleum Gas, as cooking gas is technically known, is the same internationally.

A former President, Nigerian Association of LPG Marketers, Mr. Awwal Ilu, explained that they were made to pay international price for the commodity and could therefore not reduce the rate.

He said, “To be honest, as it is today, the price is affordable. This is because we are paying the international price. For instance, price of a barrel of oil is about $104 and looking at this, you could expect the price of the LPG to be reasonably high.

“But looking at the price now, it is better than when it used to be between N6,000 and N7,000. I think we are getting somewhere. By the time you able to increase the capacity and the volume that goes to the market, you will have the benefit of a lower price.”

Ilu noted that a large percentage of cooking gas produced in Nigeria was exported, adding that marketers were working hard to ensure that domestic consumption was increased.

“Nigeria produces over three million tonnes and almost 2.8 million tonnes is being exported. But we want a situation whereby Nigeria will be able to consume all the LPG produced in the country.”

The President, NALPGAM, Mr. Basil Ogbuanu, said marketers had canvassed a reduction in the price of gas sold domestically.

He said, “In terms of supply, there is abundant gas. Our major concern now has to do with the price and consumption. It is important to know that the major supplier of this gas, which is the NLGN, is giving us the product at the international price.

“We have been requesting that government should intervene and give us domestic pricing. Since there is a quantity that is put for domestic use, which is 250,000 metric tonnes, let us also price it domestically. We are urging them to price it so that it can be affordable to the common man.”

Ogbuanu stated that the consumption of cooking gas in Nigeria had increased considerable, adding that marketers had also expanded their storage facilities so as to enhance product availability.

He said, “About two years ago, the total consumption of the LPG was around 120,000 metric tonnes per annum but today we consume 250,000 metric tonnes yearly. With the way things are going, we expect that between now and the next two years, we will be hitting 500,000 metric tonnes per annum in the domestic market.

“As it is today, through the intervention of the Federal Government and the NLNG programme, supply has improved. Before we used to have problems with the supply and storage, but today, the supply is steady because we have enough storage facilities, especially in Lagos.

“We have Nerve Gas with about 8,000 metric tonnes; NIPCO, 4,500 metric tonnes; the PPMC in Lagos, 4,000 metric tonnes, and we are aware that the NNPC wants to increase that figure to 8,000 metric tonnes; Total, 1,000 metric tonnes; and Forte Oil also has about 1,000 metric tonnes.”

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