Marketers Bemoan Crash In LPG Demand Amid Rising Prices

Marketers in Liquefied Natural Gas (LPG), popularly known as cooking gas, across the country, have cried over a decline in the demand for the product.
The Tide’s findings reveal that buyers at gas stations, especially in Port Harcourt, were scanty, which could be an indication that consumers have either reduced consumption or ditched the commodity for cheaper alternatives such as charcoal and firewood.
Manager of Delta Gas in Port Harcourt, Mr Otelema Tamuno, in a chat with The Tide, noted that sales had been on the low for several weeks in this second quarter of this year.
According to him, “since April this year, we’ve been experiencing low sales. Some people will come with 12.5kg bottle and ask that you sell N3,000 worth of gas, whereas the full bottle is N8,000. It’s so discouraging, but there’s nothing we marketers can do. Gas is costly now and we can’t sell below our cost price”.
In a related development, President, Nigerian Gas Association, Mr. Ed Ubong,  said during a downstream event in Lagos that national annual consumption was currently between 1.3mn and 1.5mn metric tons from the Federal Government’s annual target of 5mn metric tons.
Executive Secretary, Nigerian Association of Liquefied Petroleum Gas Marketers, NALPGAM,  Mr. Bassey Essien, confirmed to newsmen that the drop in consumption rate was likely due to increasing prices.
According to him, price of 20 metric tons of cooking gas had been on the rise  from N12mn to N12.8mn.
He said, “prices have been volatile for a while, and it’s because the purchasing power has dropped. Gas is no longer affordable, and buyers are either regulating use or found alternatives.
“As at today, a 20-metric-ton of gas sells for about N12.8mn. Price has hovered around 10mn-12mn before now. Just imagine what we bought last for N12mn rising by N800, 000 for one truck”.
A consumer in Port Harcourt, Mrs Irene Ndu, lamented the high costs of cooking gas and appealed that the Federal Government looked into it, saying “the Federal Government should intervene in this matter by formulating policies favourable to gas availability.
Findings have shown that about 60 percent of gas utilised in Nigeria was currently being imported by independent marketers, while the Nigerian Liquefied Natural Gas Limited (NLNG) supplies just 40 percent.
Nigeria has been described as a gas country with approximately 207 trillion cubic feet (Tcf) of proven gas reserves, ranking 9th in the world and accounting for about 3 per cent of the world’s total natural gas reserves of 6,923 Tcf. Nigeria has proven reserves equivalent to 306.3 times its annual consumption.
Natural gas is estimated as the fastest growing fossil fuel in the world, and is projected to overtake coal by 2030, as the second largest source of energy.
The Federal Government said in April, that the value of Nigeria’s proven gas reserves of about 206.53 trillion cubic feet was over $803.4tn.

By: Tonye Nria-Dappa