The federal government has directed the Nigerian National Petroleum Company (NNPC) Limited and liquefied petroleum gas (LPG) producers to stop exporting the product by November 1.
Speaking during a meeting with stakeholders on Tuesday in Abuja, Ekperikpe Ekpo, minister of petroleum resources (gas), said the directive was given due to the hike in prices of LPG, also known as cooking gas.
“As Minister of State for Petroleum Resources (Gas), I am deeply concerned about the persistent rise in the price of Liquefied Petroleum Gas (LPG), commonly known as cooking gas,” he said.
“Despite previous efforts, including the establishment of a high-level committee led by Mr. Farouk Ahmed, the Chief Executive of the Nigerian Midstream Downstream Petroleum Regulatory Authority (NMDPRA), to address the issues, prices have continued to fluctuate, recently reaching N1,500 per kg from an average of N1,100–N1,250.”
The minister said he issued three directives to address the skyrocketing price of the product and its attendant hardship on Nigerians.
He said NNPC and local producers can either stop exporting the product or import equal volumes of exported LPG at cost-reflective prices.
“Short Term Solution: With effect from November 1, 2024, NNPCL and LPG producers are to stop exporting LPG produced in-country, or import equivalent volumes of LPG exported at cost reflective prices,” he said.
EKPO DIRECTS NMDPRA, STAKEHOLDERS TO STOP INDEXING PRICES TO EXTERNAL MARKETS
Ekpo directed the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and stakeholders to stop indexing the price of the product to external markets.
He said NMDPRA and stakeholders should create a domestic LPG pricing framework within 90 days, which will index the price to the cost of production in the country.
“Pricing Framework: NMDPRA will engage stakeholders to create a domestic LPG pricing framework within 90 days, indexing price to cost of in-country production, rather than the current practice of indexing against external markets, such as the Americas and Far East Asia, whereas the commodity is produced in-country and the Nigerian people are required to pay much higher price for an essential commodity the country is naturally endowed with,” Ekpo said.
“Long-Term Solution: Within 12 months, facilities will be developed to blend, store, and deliver LPG, ending exports until the market achieves sufficiency and price stability.”
Speaking on the directive, Ekpo said they aim to improve availability and ensure affordability to protect Nigerians from the economic hardship caused by the hike in LPG prices.
“These measures are essential to improving LPG availability, stabilizing prices, and easing the economic burden on Nigerians. Our goal is to ensure that every Nigerian can access affordable cooking gas,” he said.
According to the National Bureau of Statistics (NBS), the average price of 5 kilogrammes (KG) of cooking gas increased to N6,699.63 in September.
In February, the federal government announced the suspension of LPG exports.(the Cable)
