The Federal Government has halted the export of locally produced Liquefied Petroleum Gas (LPG), commonly known as cooking gas, to prioritize domestic supply.
This measure, announced by the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, will take effect on November 1, 2024, and aims to address the rising gas prices in Nigeria. The announcement was made in a statement by the minister’s spokesman, Louis Ibah, in Abuja.
The decision followed a high-level meeting convened by the minister with stakeholders to tackle the skyrocketing prices and the resulting hardship faced by Nigerians. In an effort to combat the soaring cost of cooking gas, the minister established a high-level committee in November 2023, led by the Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Mr. Farouk Ahmed, along with key stakeholders in the LPG value chain. However, despite these efforts, prices have continued to fluctuate, recently rising to N1,500 from an average of N1,100 to N1,250 per kilogram.
To further address this issue, the minister outlined both short-term and long-term targets. He stated, “Effective November 1, 2024, NNPCL and LPG producers must stop exporting domestically produced LPG or import equivalent volumes of LPG exported at cost-reflective prices.” Regarding the pricing framework, he instructed the NMDPRA to collaborate with stakeholders to establish a pricing framework within 90 days.
The statement noted, “The pricing framework will index the cost to in-country production rather than the current practice of referencing external markets, such as those in the Americas and Far East Asia. This approach is necessary as the commodity is produced locally, yet Nigerians are required to pay significantly higher prices for this essential resource.”
As a long-term solution, the statement indicated that facilities would be developed within 12 months to blend, store, and deliver LPG, with exports ending until the market achieves sufficiency and price stability.
The minister expressed deep concern over the ongoing increase in the price of Liquefied Petroleum Gas in the country. Ekpo’s directives represent a proactive step toward addressing the challenges and ensuring that Nigerians have access to affordable cooking gas.
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