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Nig. Plots to Become Continent's LPG Hub
Oct 10 2009

The federal government's renewed efforts to increase the use of Liquefied Petroleum Gas (LPG) popularly called cooking gas will be further deepened as gas stakeholders gather in Abuja from tomorrow to chart ways of making Nigeria Africa's LPG hub. This summit on LPG is being organized by the Senate Committee on Gas.

Nigeria has about 186 trillion cubic feet of gas but is ironically among the lowest consumers of LPG in Africa. The federal government has been leading a spirited campaign to revive LPG business in Nigeria and recently summoned the International Oil Companies (IOCs), and handed them a six month ultimatum to make cooking gas available and affordable in Nigeria.

Following this determination of the federal government to maximize the nation's gas potentials and get Nigerians to adopt LPG as their primary energy for cooking, a retinue of new players are now positioning and repositioning in the steadily returning Liquefied Petroleum Gas (LPG) market. Growing the LPG market in Nigeria is a critical component of the nation's Gas Master Plan and market watchers say government's efforts have begun to yield fruits. A lot of new investments are now coming into the domestic cooking gas market.

Chimons Gas, a leading gas supplier has brought into the country ultra modern gas cylinders and special cylinder-mounted mini gas cookers to help spread the use of cooking gas among Nigerians. Already, three state governors are said to be arranging to buy 100,000 of the cylinders for sale in their states at reduced prices. Chimons Gas has also acquired six brand new trucks to ensure effective distribution nationwide while it has also launched a cylinder dealership scheme. The company is also developing an integrated LPG terminal with 30,000 metric tones capacity expected to ease logistic problems being experienced in the industry. The terminal is expected to be ready in by 2010 along with a wholly owned LPG vessel.

Hyson Nigeria Ltd is building a mega LPG refilling plant in Abuja and plans to assist LPG marketers through the banks to upgrade or build new micro storages, buy new trucks and standard refilling cylinders.

Linetrale Gas is developing an ultra modern LPG terminal in Lagos expected to provide storage and trading hub for all major and marginal field gas producers in Nigeria, creating an in-road for these producers to the domestic market.

Harig Oil is working on the construction of an LPG and products storage terminal, expected to be the biggest LPG supply hub in West Africa.Recently African Petroleum Plc (AP) also brought into the country innovative transparent gas cylinders for accelerated nationwide marketing of cooking gas to Nigerians. Late last month, Minister of State for Petroleum, Mr. Odein Ajumogobia commissioned an LPG cylinder manufacturing plant in Ogun state and reiterated federal government's resolve to get Nigerians to abandon the use of fire wood and kerosene for cooking and have them adopt cooking gas.

Market watchers say cylinders can be used to grow Nigerian gas market as the entire country of 140 million people is estimated to have about 500,000 cylinders only, most of them old, dilapidated and therefore dangerous.

Chimons Gas which has a partnership agreement with Mauria Udyog, India's biggest exporter of LPG cylinders says the company plans to "massively flood Nigeria with cylinders and we will be doing that with partners who will not only sell cylinders but will also sell gas".

Millions of Nigerians abandoned the use of cooking gas in the 1990s when it became scarce and the price of the 12.5kg cylinder shot past N8000, heading to N10,000, depending on where you were buying. But as part of Nigeria's efforts to develop her estimated 186 trillion standard cubic feet of gas (tscf) reserves, re-invigoration of the use of cooking gas is an important aspect of Nigeria's gas master plan. Strategies are now being stimulated to make gas available to Nigerians at highly reduced prices while NLNG, prodded by the federal government has domiciled 150,000 metric tones of LPG for the domestic market. Chimons, Hyson, Linetrale and Harig are among the 6 off- takers that receive gas directly from the NLNG plant at Bonny.

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