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Nigeria consumed 250,000 tonnes of LPG in 2013 – PPMC

By BusinessNews Staff on March 30, 2014

Nigerians consumed a paltry 30 per cent or 250,000 tonnes, out of the whopping 850,000 tonnes of Liquefied Petroleum Gas (LPG) reserved for domestic use last year.

According to the Managing Director of the Pipelines and Products Marketing Company (PPMC), Prince Haruna Momoh, this translates to a meager consumption figure of 1.8kg per capita, compared to the West African regional average of 3.5kg.

Momoh, who made the disclosure while speaking on “Stimulating Consumption of LPG in Nigeria,” at the just-concluded NALPGAM Inaugural Conference in Lagos, said that the figure had placed Nigeria among the lowest LPG consuming nations in Africa.

“There is an urgent need to reverse this trend and join the rest of the world in maximizing the benefits of this abundant resource,” he stated.

The PPMC chief said there was urgent need for action, to stimulate LPG use, suggesting that Nigeria could adopt the “Indonesian Model” to popularize LPG.

He said that billions of revenue could be saved by Nigeria if the populace embraced LPG, rather than relying on wood and kerosene for cooking.

Momoh noted that resources spent on kerosene subsidy, could be put into more productive areas, such as infrastructure development, education, health and agriculture for the welfare of citizens.

He lamented, however, that some problems, including high cost of cylinders and accessory start up kits, low public awareness, poor infrastructure, kerosene subsidy and a lack of investment in the value-chain had continued to make many Nigerians not to embrace LPG.

The managing director, therefore, called on stakeholders in the downstream to join forces with government to pursue the vision of deepening the use of LPG.

Similarly, the Techno Oil boss, Mrs Nkechi Obi, while presenting her paper titled ‘Enhancing Liquefied Petroleum Gas Growth in the Nigerian Market’ during the inaugural NALGAM conference, argued that the way out was for government to engage a graduated removal of kerosene subsidy over a period of five years to compel Nigerians to use LPG.

She suggested that government should discount equivalent of 20% of the value of the kerosene subsidy for every year and channel same to LPG support. She lamented that subsidizing the consumption of kerosene was increasingly becoming harmful to Nigeria’s economy.

Obi, who is the Executive Vice-Chair of Techno Oil Ltd, said that the savings on the subsidy could be spent on the acquisition of gas cylinders to promote utilisation of LPG. She also said for sustainability, government should invite entrepreneurs to invest in the LPG infrastructural development the same way fuel depot infrastructural development was executed assuring investors return on investments

“With all sincerity, government subsidizing kerosene is not sustainable and it is also not healthy because the world has moved on and Nigeria also has to move. She was of the opinion that government should install an agreed programme that would ensure that the subsidy removal would not create more problems nor hurt the citizenry unduly.

[Vanguard]

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