Nigerians Domestic Gas Consumption Low

Fri, Apr 4, 2014

By publisher

3 MIN READ

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|  By Anayo Ezugwu  |

THE Pipelines and Products Marketing Company, PPMC, wants more Nigerians to use domestic gas otherwise known as Liquefied Petroleum Gas. As at now, Nigerians consumed 30 percent or 250,000 tonnes of LPG, out of the 850,000 tonnes reserved for domestic use in 2013. This translates to a meagre consumption figure of 1.8kg per capita, compared to the West African regional average of 3.5kg. This figure places 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 maximising the benefits of this abundant resource,” said Haruna Momoh, managing director, PPMC, while speaking on “Stimulating Consumption of LPG in Nigeria,” at the just-concluded NALPGAM inaugural conference in Lagos. Momoh said there was urgent need for action, to stimulate LPG use, suggesting that Nigeria could adopt the “Indonesian Model” to popularise LPG. Nigeria could save billions of revenue if the populace embraced LPG, rather than relying on wood and kerosene for cooking. The 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.

Some of the factors stopping Nigerians from embracing LPG include high cost of cylinders and accessory start up kits, low public awareness, poor infrastructure, kerosene subsidy and  lack of investment in the value-chain. He, therefore, called on stakeholders in the downstream to join forces with government to pursue the vision of deepening the use of LPG in the country in 2014.

Similarly, Nkechi Obi, executive vice-chair, Techno Oil Limited, while presenting her paper titled ‘Enhancing Liquefied Petroleum Gas Growth in the Nigerian Market’ argued that the way out was for government to start 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 percent of the value of the kerosene subsidy for every year and channel same to LPG support. She lamented that subsidising the consumption of kerosene was increasingly becoming harmful to Nigeria’s economy.

Obi 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 subsidising kerosene is not sustainable and it is also not healthy because the world has moved on and Nigeria also has to move. I am 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,” she said.

— Apr. 14, 2014 @ 01:00 GMT