Bayo Akomolafe 
Poor access to foreign exchange and scarcity of vessels to ferry Liquefied Petroleum Gas (LPG) is currently posing obstacles to meeting Nigeria’s domestic gas supply shortfall of one million tonnes valued at N1.2 trillion.
It was learnt that this may further lead to hike in the price of LPG in subsequent months despite the removal of import duties by the Federal Government.
The price of gas increased from N900 per kilogramme in June to N1,200 per kg in July 2024 as consumption is estimated at 1.5 million tonnes, while domestic supply is less than 500,000 tonnes, leading to a short supply of one million tonnes in the local market.
Findings from the Nigerian National Petroleum Company Limited (NNPCL) revealed that total gas production was 851,277 tonnes for domestic and export markets between January and June 2024.
In June, the output was 147,634; May, 142,415; April, 133,923; March, 136,686; February, 134,067 and January, 156,552.
Import of LPG, according to National Bureau of Statistics (NBS), was N194.68 billion in first quarter of 2024. However, it was gathered that only 20 LPG vessels were servicing Nigeria’s market from Europe as the country depends on one NLNG’s LPG vessel, while other carriers are foreign owned ships.
Also, only 12 LPG depots are in Lagos with capacity to store 69, 968 tonnes (6.9 million litres), while only NAVGAS and New Oil Jetty (NOJ) terminal in Lagos are the only jetties getting regular supply.
Findings also indicated that with the gas price of between $280 per tonnes, the prices of importing LPG into Nigerian port is between $405 per tonnes when $125 landing cost is added.
Currently, Nigerian Ports Authority (NPA)’s shipping data indicated that only Claude has arrived Delta port, Warri with 6,000 tonnes of LPG, two vessels were at the Lagos jetties moored to offload 22, 000 tonnes from Fortune laden with 15,000 tonnes and Nisyros, 7, 000 tonnes.
Meanwhile, with a 15 per cent annual growth rate, Nigeria’s demand had surged from 1.1 million tonnes to 1.3 million tonnes in 2023 and is expected to increase to1.5 million tonnes in by the end of 2024.
However, 100 per cent of produced LPG volumes from NLNG have been channelled to the domestic market, supplying about 40 per cent or 440, 000 tonnes of Nigeria’s domestic LPG demand.
Currently, NLNG is the highest single supplier of LPG into the domestic market, with an estimated 493,000 metric tonnes supplied in 2023.
Recalled that the company’s Chief Executive Officer, Mr Philip Mshelbila explained that in 2021, NLNG increased its LPG supply commitment from 350,000 metric tonnes (or 28 million 12.5kg cylinders) to actual delivery of 400,000 metric tonnes (or 32 million 12.5kg cylinders), thereby directing most of its production into the domestic market.
He added: “This commitment to do all that we possibly can and supply 100 per cent of our LPG production to the domestic market.”
Also, Chief Executive Officer of Nigeria LNG Limited, Mr Philip Mshelbila had explained that in 2021, NLNG increased its LPG supply commitment from 350,000 metric tonnes (or 28 million 12.5kg cylinders) to actual delivery of 400,000 metric tonnes (or 32 million 12.5kg cylinders), thereby directing most of its production into the domestic market.
He added: “This commitment to do all that we possibly can and supply 100 per cent of our LPG production to the domestic market.”
Mshelbila noted that the focus on domestic market marked the company’s strong commitment to its passion to increase the utilisation of one of the most versatile energy sources in the world.
“Committing 100 per cent of our LPG supply is a major milestone in our journey of domestic gas supply.
We supplied our first butane cargo into the domestic market in 2007, which helped to develop over the years the LPG industry in Nigeria from less than 50,000 tonnes to over one million tonnes market size annually by the end of 2020,” he said.
He stressed that gas was an essential energy source to be reckoned with during this energy transition period.
