LPG hike: Retailers urges FG to provide incentives to investors
By Yusuf Yunus
The Liquefied Petroleum Gas Retailers (LPGAR) has appealed to the Federal Government to provide incentives to the LPG investors to make the price affordable.
Mr Ayobami Olarinoye, Branch National Chairman of LPGAR, made the appeal in an interview with the Business Intelligence (TBI Afric) on Friday against the backdrop of incessant hike of cooking gas.
It would be recalled that the President, Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), Mr Olatunbosun Oladapo, said that the price of Liquefied Petroleum Gas also known as cooking gas has “gone astronomically high at terminals.
This was as a result of a sudden increment from between N9 million to N10 million per 20 metric tons to N14 million per 20 metric tons.
According to Olarinoye, in the last three weeks, LPG price has recorded more 30 per cent increment and it is likely to continue.
He said this is because the off-takers and depot owners continue to make upward review of the price almost on daily basis.
“Some of our members have run out of stock because they cannot restock their outlets as the result of the sharp increases.
“This development has brought untold hardship to Nigerians who are currently struggling to survive the hardship brought about by the recent removal of subsidy,” he said.
Olarinoye said: “We are appealing to the Federal Government to provide incentives to the LPG investors to make the price affordable.
“Similarly, our union believes that the incessant rise in LPG price would be contained if more storage facilities are built by the major marketers and off-takers.
“We equally think that both states and federal governments should equally intervene in the way of building depots and maintaining the existing ones built by federal government,” he added.
The LPGAR chairman said that if this is done it would equally provide a leeway for non-major-marker off-takers to use the depots devoid of ‘commercial’ encumbrance.
He also appeal to the Nigerian Liquified Natural Gas (NLNG) to increase its production capacity in order to meet the rising demand of LPG.
“We believe that if NLNG transacts with their local LPG marketers in local currency that it would go a long way in reducing and of course stabilize the price.
“Already, the poor are going back to the traditional cooking energies which are detrimental to their health and the ecosystem,” Olarinoye explained.
Similarly, the NALPGAM President
called on the Minister of State Gas Resources and other government agencies to audit the volume of cooking gas supplied to the domestic market by the Nigerian Liquified Petroleum Gas (NLNG) and determine the rate and quantity at which it is being supplied.
He also stated that other local gas producers, including Kwale Hydrocarbon Nigeria Limited (KHNL), Matrix Energy Limited, are selling at prices equivalent to imported products, which he described as a rip-off on innocent Nigerians.
He said, “Cooking gas is a product for all classes of people, including the poor, who consume only things that they can afford to cook, compared to the wealthy and middle/upper classes of people who can afford to buy processed and finished foods in the malls.
Olatunbosun noted that Nigeria’s consumption of cooking gas has dropped to around 700,000 metric tons per annum in the last year.
This, according to him, is significantly lower than other countries, Republic of Benin consumes more cooking gas than in Nigeria.
He mentioned that Morocco is the leading African country in terms of consumption, followed by Algeria, despite having a smaller population, adding that Nigeria, with over 200 million citizens, is struggling to consume less than 1 million metric tons per annum.
” The domestic utilization of cooking gas in Nigeria has dropped in recent times, and many families cannot afford to cook with cooking gas.
“The Federal Government must intervene on behalf of the poor and reduce the greed for profiteering by importers of cooking gas.
“If nothing is done urgently to ameliorate the impending crisis, the government should expect to see a surge in cutting down of trees as more people will abandon cooking gas, while deforestation surges and further compounds Nigeria’s exposure to erosion and all forms of environmental crisis, including desert encroachment,” Olatunbosun warned.
