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Cooking gas crisis to ease as marketers await arrival of NLNG vessel

By on June 8, 2016

Barring any unforeseen circumstances, the Nigeria LNG Limited will bring a vessel of Liquefied Petroleum Gas (LPG, better known as Cooking Gas, to Lagos this week, thus effectively resolving the supply crisis that created a monopoly situation in the past one week, THISDAY has learnt.

THISDAY gathered that unlike the last vessel, which berthed at the NAVGAS terminal in Apapa only for the private terminal to take the whole product and hike the price, the new vessel will berth at the main Apapa Jetty, owned by the Nigerian National Petroleum Corporation (NNPC).

Investigation revealed that the vessel, ‘Gas Providence’ will berth at the Apapa jetty for all the marketers, who constitute NLNG offtakers to take product from it.

A source at NLNG confirmed to THISDAY on Saturday that the vessel had fully loaded at Bonny Island but that its departure to Lagos would depend on the availability of berthing space.

According to the source, the North Oil Jetty (NOJ) jetty at Apapa, where LPG vessel discharges in Lagos is currently occupied by a vessel, which brought in 28,000MT of petrol for Total Nigeria Plc.

“Total brought in the vessel, ‘MT UNICORN’ which arrived three days ago and is yet to discharge,” he added.
Executive Secretary of the marketers under the aegis of the Nigerian Association of LPG Marketers, Mr. Bassey Essien told THISDAY at the weekend that the marketers were expecting LPG vessel this week.

According to him, the arrival of the new vessel will resolve the present crisis where one of the marketers hiked the price of 20 Metric Tonnes LPG from N2.4 million to N3.5 million in less than one week.

“The price is still N3.5 million but we have strong assurance that another vessel will come in this week,” Essien said.

NNPC has three jetties that constitute the Apapa Jetty – Petroleum Wharf (PWA); BOP and NOJ, all used by vessels to discharge petroleum products.

However, it was learnt that only NOJ has facilities to discharge cooking gas and this has created logistics challenges for LPG vessels.

One of the LPG marketers told THISDAY at the weekend that whenever NLNG brings LPG vessel to Lagos and another vessel is discharging petrol at NOJ, the LPG vessel will either wait and incur huge demurrage or go to NAVGAS terminal, which is a private jetty and the only other alternative jetty that can receive LPG vessel in Lagos.
This logistics challenge, the marketer argues has allegedly given the operators of the private terminal and some officials of the NNPC the opportunity to create monopoly situation by ensuring that when LPG vessel arrives in some instances, the NOJ will be occupied.

“We have serious logistics challenge in this business and it has been there. The challenge is that only NOJ, which belongs to PPMC and one private terminal can receive LPG vessel in Lagos. People have capitalised on this challenge to create monopoly and engage in price fixing. So, sometimes when LPG vessel comes in, NOJ will be occupied and NLNG will not take the product back to Bonny Island or allow the vessel to wait and incur demurrage. The vessel will be forced to discharge the product at the private terminal and the terminal will take the product and turn to a monopolist. Each time this happens, the price will suddenly jump up,” he explained.

The marketers had raised the alarm over the artificial hike in the price of the product from N2.4 million per 20 metric tonnes to N3.5 million.

Essien had called on the federal government to intervene and stop the hike, adding that unlike the prices of other petroleum products, which are paid in dollars, the price of LPG is not paid in dollars, hence there is no reason for the price hike.

 

[ThisDay]