NLNG to boost LPG supply to 450,000 tpa

[By Sopuruchi Onwuka]

Africa’s gas liquefaction and export factor, Nigeria Liquefied Natural Gas (NLNG) Limited, has declared intention to increase the volume of liquefied petroleum gas (LPG) is feeds into the domestic market by next year.

NLNG MD, Mr Tony Attah

The uptick in domestic LPG supplies is in response to health complications arising from toxic fumes emitting from kerosene and firewood used in preparing meals in poor rural communities.

Managing Director, Mr Tony Attah, declared at webinar hosted by the Nigeria-British Chamber of Commerce on Thursday that the management of the company has secured the approval of the board for additional supply of 100,000 tons per annum, increasing the company’s total intervention in local LPG supply from 350,000 tons per annum in 2020 to 450,000 tons per annum in 2021.

Mr Attah who also demanded legislation for sustainability of gas programmes in the country pointed out that the nation’s vision for gas valorisation and utility should be long terms and sustainable in order to achieve the full economic, health and environmental objectives.

He described the proclamation of 2020 as Nigeria’s year of gas as fleeting, arguing that the nation requires a sustained gas programme to enable players lay out plans for meeting the estimated local LPG demand of 3.0 million tons per annum.

He lamented the paradox of Nigeria’s status of a gas nation whose citizens fall among the one million women and girls that die of kitchen fumes annually.

In pointing out the urgency of addressing local LPG supply deficits in the country, Mr Attah noted that some 100,000 Nigerian women and girls in the rural arrears form part of the one million fatal casualties of kitchen fumes annually.

“Kitchen fumes kill more Nigerians than COVID-19,” he stated, adding that NLNG has been at the forefront of addressing local supply challenges from multiple fronts that include volumes of molecules, logistics and supply chain debottlenecking.

Part of the measures deployed by the company, he explained, is empowerment of local players in supply chain logistics which, according to him, has broken the round trips for supply of LPG to communities contiguous to the production plants in Rivers State.

Before now, Mr Attah explained, LPG supplies from NLNG plants were shipped to Lagos, discharged into storage tanks from where they were trucked by road back to Rivers State for distribution to local consumers who reside around the company.  

Dwelling on the benefits of displacing firewood and other kitchen fuel products with LPG, Mr Attah expressed sadness that over 100,000 Nigerian women and children die from complications arising from exposure to kitchen fumes in rural communities annually.

He said the Nigerian fume poisoning figure forms about 10 percent of the annual one million fatal casualties of kitchen fumes globally as the world’s poorest people continue to die from complications from dirty domestic fuel.

While digressing towards benefits and values NLNG has created in the local operating environment, he declared that the company was making efforts at addressing domestic pollution in Nigerian with supply of annual 650,000 tons of cooking gas to arrest fatalities arising from use of dirty fuel and biomass in home cooking in the country.

He said the company has taken the obligation to withhold huge volumes or LPG from its export market stock in order to intervene deepening the domestic market with cleaner, cheaper and available fuel options for homes and businesses that rely on heating fuel.

Mr Attah stated that the company was working with 36 local companies to guarantee supply huge volumes of cooking gas to meet about 45 percent of total demand in the domestic market.

The Oracle Today reports that despite the huge volumes of cooking gas NLNG has supplies in the domestic market, acute supply gaps still exists and spike prices in the local environment well above global templates.

With 45 percent supplied by the country’s biggest LPG producer, local dealer still rely on importation to plug the 55 percent supply gap, neutralizing the cost benefits of local production.

With importation, traders build a wide range of cost components that actually push the prices of the product above N100 per kilogramme. Part of the components that sum up the cost include shipping, insurance, port charges, demurrage, coastal logistics, inland trucking, throughput and storage.

Acute infrastructure deficits, our findings have shown, have limited smooth flow of the highly volatile household gas from reaching homes efficiently through pipelines, leading to distribution and retail of the product in metal cylinders of various sizes. And use of cylinders, according to market analysts, comes with added cost as poor families must have to acquire the micro storage units in order to switch to cleaner kitchen fuel.

Mr Attah stated in the webinar that his company would work with other private investors in the industry to respond to rising demand for gas in the domestic market, declaring that Nigeria’s story has changed from oil to gas.

He pointed out that projected surge in the country’s young population would continue to generate demand for gas both for domestic, commercial and industrial utilization.

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