Sustaining discourse on domestication of Nigeria gas

Nigeria’s Liquefied Petroleum Gas (LPG) consumption as at 2014 was 350,000 metric tons which implies that Nigeria’s annual LPG consumption per capita is about 2.0 kg. This figure accounts for 10 percent of its annual LPG production, leaving about 90 percent gap market potential for development.

Reports from Nigeria Liquefied Natural Gas (NLNG) Limited indicate that the country produces over 3.2million metric tons of LPG annually, earmarks about 850,000 metric tons for domestic consumption.

With a population of over 170 million people, it is the expectations of industry close watchers that Nigeria with such huge domestic market potential waiting to be explored. This is the best time to develop domestic LPG market and consequently build a robust economy that is primarily driven by LPG.

Statistics have shown that Nigeria’s proven Gas reserves stands at 187 Trillion Cubic Feet, while unproven ones stand at 600 Trillion Cubic Feet which make Nigeria rank 7th among Gas producing nations.

Analysts opine that the right approach for the government and other stakeholders in the industry to fashion out how to build a long term economy that will be pivoted on the domestic LPG market and less affected by external factors.

According to experts, “LPG has huge benefits and uses when compared to other competing fuels such as firewood, charcoal, kerosene and gasoline. There is no doubt that LP Gas availability in Nigeria is sustainable on a long term and it is also an eco-friendly fuel”.

Among other benefits, LPG as a clean energy source is an eco-friendly fuel which makes it easier for Nigeria to adopt as her primary energy source both for domestic and other industrial applications.

In their opinions, The government need revive its drive and passion towards creating the enabling environment through favourable legislation and other budgetary provisions which will give LPG advantage over other competing fuels and also give the private sector the needed confidence to invest and reinvest in capital infrastructures which will aid in building a robust LPG market that Nigerians will be proud of.

Local operators in the gas industry are optimistic that an improved investment climate will increase Nigeria’s 300,000 metric tons domestic LPG market which currently ranks lowest in Africa.

They maintains that Local investments in the Liquefied Petroleum Gas (LPG) currently being hampered by currency mix match, pricing mechanism, absence of attractive fiscal regime among other would witness radical growth by way of investment once government provide an enabling environment.

The expectation is that once government through a sustainable framework encourage duty-free regime on the LPG value chain, private sector is willing to invest to enhance the country’s cooking gas market.

Dada Thomas, managing director, Frontier Oil Limited observes the only incentive for indigenous companies willing to continue to invest in gas for domestic use is if government provides an enabling environment”.

Thomas opines that freeing gas for local investors is the first step toward encouraging willing investors to develop gas for the domestic market.

KELECHI EWUZIE