High Cost of LPG Forcing Nigerians Back to Firewood
…..LPG Association Beckon on Govt for Action
By Chibisi Ohakah, Abuja
Experts under the auspices of Nigeria Liquefied Petroleum Gas (LPG) Association have cried out that the high prices of LPG in Nigeria is shifting demand to firewood and charcoal, and thus fuelling desertification and erosion with a very negative impact on the environment.
Investigations showed that the price of the product currently hovers at N8,500 and N9,500 per 12.5 kg, depending on the area as consumers increasingly return to fossil fuel energy in different parts of Nigeria.
The Association has therefore called on the Nigerian government to package new incentives to stimulate investment, processing and utilization of LPG in Nigeria in line with the nation’s Decade of Gas agenda.
Rising from the just-concluded 11th International Conference and Exhibition in Lagos, the group noted that the LPG sector gasps for massive infrastructural development to stimulate and sustain expansion in the coming years.
In a communiqué issued after the conference, the association urged the Nigerian government and its agencies to “intentionally eliminate all hindrances, especially lack foreign exchange, currently staring the sector in the face.”
Earlier in his address, President of the Nigeria Liquefied Petroleum Gas (LPG) Association, Mr. Nuhu Yakubu, said that in view of this development, his association is engaging relevant agencies and stakeholders with a view to addressing arising from the prolonged era of foreign exchange, high prices and instability in Nigeria’s LPG sector.
He said the association is engaging with respective government agencies in addressing issues around LPG supply, particularly access to foreign exchange, value-added tax, levies, etc. expressing the believe the efforts will yield positive results in good time.
Further in the communiqué, the association said: “It is not far-fetched to state, therefore, that sustaining the growing adoption of LPG through sector-friendly policies and programmes will advertently support economic growth that will yield jobs and wealth creation. It is our collective responsibility to make this happen and an event such as this is one aimed at setting the pace.
“In line with the 7th Sustainable Development Goals (SDGs), deepening education on the role of diverse applicable uses of LPG is critical as the world aims to provide cleaner, reliable, sustainable and affordable energy sources for everyone by 2030.
“Worthy of mention is the declaration of the Decade of Gas, by the minister of state for petroleum resources, Chief Timipre Sylva with the support of the President Muhammadu Buhari (GCON), who ably doubles as honorable minister of petroleum resources.”
The conference noted that the nation had very huge gas reserves of over 200 trillion standard cubic feet, but regretted that the current business environment had not been friendly.
“That the Petroleum Industry Act, PIA, should be implemented in a manner that will encourage massive domestic and foreign investments, required to stimulate sustainable growth while creating many multiplier effects, including jobs for Nigerians.
“That such new investments are required to reduce Nigeria’s current dependence on imported LPG as well as meet rising future demand based on increased population. That the government should be consistent in the conceptualization and implementation of policies needed to ensure stability in the LPG sector,” the communiqué continued.
It also said that relevant stakeholders need to be involved and carried along in the process of taking new decisions to ensure successful implementation, and that the imposition of the Value Added Tax, VAT, has negatively affected the sector in many unintended ways and should be eliminated.
Meanwhile, the Nigerian government has said that it is moving to check the rising price of cooking gas by setting up a new Domestic Base Price for gas as the, ‘Export Parity Price at the delivery point where there is a dominant supply of gas in Nigeria.’
Chief executive officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) Engr Farouk Ahmed, in a statement in Abuja, set out a new Domestic Base Price (DBP), framework and applicable gas wholesale price for the strategic domestic sector. He stated that the applicable Wholesale Gas Price for the power sector shall be the established Domestic Gas Price.