The level of usage of liquefied petroleum gas, also known as cooking gas is still low in Nigeria despite 1000 percent growth in the industry between 2007 and 2017

The Nigeria Liquefied Petroleum Gas Association, NLPGA, has said that over 90 percent of Nigerian homes do not have Liquefied Petroleum Gas, LPG, cylinders. As a result of this, many Nigerians are exposed to health hazards characterised by the use of kerosene and wood among others for cooking.

The NLPGA, in its latest report, said out of the 30 million homes in Nigeria, only three million homes make use of cooking gas. This development is capable of sustaining the high death rate in the country linked to dirty fuel usage.

It, therefore, stressed the need for the government and other stakeholders to intervene to ameliorate the situation and drive the influx of additional LPG cylinders and other accessories, considering the level of poverty that is currently ravaging the country.

Nuhu Yakubu, president, NLPGA, said although the LPG industry in Nigeria had grown by over 1,000 percent between 2007 and 2017, the level of adoption was still low given the huge number of homes that lacked the basic entry requirement for usage.

According to him, the exponential growth seen in Nigeria LPG had been anchored on private capital and sponsorship, which are not sufficient to give the adoption the required penetration considering the country’s population.

Citing development of LPG in some neighbouring African countries, he said in Ghana, about 70 percent of cars run on LPG, which is a strong bashing for Nigeria that is still struggling to cook its food with LPG. “LPG is the most diversified gas in the world, and Nigeria has enormous reserves of the commodity coupled with the high level of production. We should be the ones driving this innovation but the reverse is the case.

“Currently in Nigeria, the LPG consumption rate per capita is three kilogrammes, which is far below when compared to 12-30kg per capital for industrial set-ups. There should be deliberate actions by government, policy-wise, to trigger growth because LPG infrastructure is expensive, characterised by high cost of entry for consumers (homes). This is the chief reason why it is not getting to the hinterlands,” he said.

Yakubu said if the exchange rate of the Naira was not dropping, the price of LPG, as a commodity, would have dropped in the last 10 years. He added that the fall in the value of the Naira remained the reason the product is currently expensive. “If not for the worsening exchange rate of the naira to the dollar, the normal 12.5kg gas should be selling for less than N1,000 now; the same quantum was sold for N3,000 10 years ago. Despite the multiple devaluation of the naira, LPG cost for the normal 12.5kg-size is still less than N4,000.”

He stressed that the LPG industry needed palliatives, and not subsidy, noting that subsidy has not helped Nigeria in any way, but has continued to create fund management problem for the country. “We keep subsidising petrol for the rich in Nigeria, who are the biggest consumers of the product. If a sizeable portion of the subsidy fund is used to finance infrastructure development in the LPG sector, we will see more Nigerians using the product for diverse purposes, which will improve their health status, reduce pressure on their finances and make the overall economy better.

“The two critical sectors of the economy that can emancipate Nigerians from poverty, that is power and petroleum, are bedevilled by subsidy. So, we don’t advocate for subsidy. Owing to the fact that LPG is an economic enabler, we call for government intervention in the areas of fiscal incentives for cylinder manufacturers, import duties reduction, Value-Added Tax, VAT, removal, and incentivising cylinder distribution in Nigeria, among others.”

Considering the huge gap in LPG usage, especially in the northern part of the country, Gaylon Duru, first vice president, NLPGA, said the association was poised to take its awareness campaign to the area leveraging its 8th LPG annual conference and exhibition in Abuja, on November 29 and 30, with the theme: “LPG Diversification: Expanding LPG Frontiers in Nigeria,” he said.

According to him, the policy of deregulation has helped the industry significantly to get to its present level, and the need to share the experience to attract more investors and impact other African countries cannot be overemphasised.

Beyond cooking, Duru said it was germane for Nigerians to see the other benefits of LPG, adding that the wide usage of the product remained a catalyst to economic, health and environmental prosperity.

– Nov. 23, 2018 @ 14:59 GMT |