Oil & Energy
Nigeria’s LPG Production Hits 5m Tonnes
The Federal Government says Nigeria currently produces about five million tonnes of Liquefied Petroleum Gas (LPG) annually and only eight per cent of the production is being utilised domestically, with the bulk being exported.
It says domestic LPG production stands at about 45 per cent of annual consumption, with Nigerian Liquefied Natural Gas Limited (NLNG) supplying 450,000 metric tonnes per annum while 55 per cent is imported.
Special Adviser to the President on Economic Matters in the Office of the Vice President, Dr Adeyemi Dipeolu, made this known recently at an India-Nigeria LPG Summit, Abuja, 2022.
The Tide’s source reports that the India-Nigeria LPG summit was hosted by Nigerian National Petroleum Company Limited (NNPC Ltd.) with the support of the Office of the Vice President and World LPG Association (WLPGA).
The summit is expected to translate into bilateral exchanges to foster mutual collaboration and opportunities for the Nigerian LPG industry to learn from India’s experience, one of the world’s most successful National LPG penetration initiatives.
In a keynote address, Dipeolu said Nigeria had the ninth largest proven natural gas reserves in the world, and also the second largest producer of LPG in Africa after Algeria.
“LPG adoption in the Nigerian market, of course, is still very low with per capita consumption at about 1.8 kg, which is below the West African average.
“The household energy mix in Nigeria is about five per cent LPG, 65 per cent biomass and 30 per cent kerosene.
“The preference for the use of other sources is largely due to high switching costs associated with the acquisition of cylinders and LPG stoves, lack of awareness of associated benefits and safe LPG handling across consumer basis.
“There is also the high cost of LPG in comparison with alternative fuels, insufficient and inappropriate cylinders in circulation and inadequate infrastructure, especially trucks, roads, rail pipelines and plants,” he said.
He said the predominant use of biomass for household cooking resulted in deforestation and ambient air pollution, which also could lead to death due to stroke, heart disease, lung cancer and chronic respiratory diseases.
The Presidential Aide underscored the imperative for policies, incentives and investment to grow the Nigerian LPG market.
This, he said, would make cleaner fuel available, accessible and affordable, not only for household cooking, but also in autogas, captive power generation, heating and cooling as well as agriculture and industry.
He expressed optimism that Nigeria would learn from Indian’s experience with the Pradhan Mantri Ujjwala Yojana (PMUY) scheme implemented by the Indian Government in May 2016 such that LPG penetration in that country increased from 62 per cent to 100 per cent currently.
He said the theme of the summit, ‘Energising the Future: Leveraging the Indian Experience to Achieve Nigerian National LPG Aspiration’ underscored the need for cooperation and collaboration between the two countries.
Dipeolu said the cooperation should dwell on policy structures; health, safety and environmental methods and standards, ICT, infrastructure management techniques, stakeholder engagement and innovative programmes to incentivise Nigerian LPG market growth.
According to him, the recently enacted PIA specifically provides enablers for robust midstream and downstream gas development through promotion of policies, incentives and wavers to stimulate investments.
Others, he said, included removal of VAT on domestic LPG, presidential waiver on duty imported LPG equipment, tax holiday on new investment on gas and approval of eight new LPG terminals and storage facilities to add 150,000 metric tonnes gas capacity.
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Oil & Energy
Delta Targets 120MW Power Boost, Moves To Cut Reliance On National Grid
The State Commissioner for Works (Rural Roads) and Public Information, Charles Aniagwu, disclosed this at a press conference in Asaba, weekend, noting that the initiative was part of wider reforms aimed at opening up the power sector to private investors.
Aniagwu, who was accompanied by the Executive Assistant to the Governor on New Media, Felix Ofou, said the state was exploring alternative sources of electricity to support businesses, households and communities while reducing pressure on the national grid.
He said the government was particularly interested in exploiting Delta’s abundant natural gas resources for power generation, pointing to the Kwale Free Trade Zone, which is part of the state’s special economic zone, as a major opportunity for investors.
According to him, prospective investors were taken to the zone during the state’s recent economic summit to enable them to assess the availability of gas as a key raw material for electricity generation. ComparePower Rates
The commissioner explained that generating more electricity locally would not only increase supply in Delta but also free up power on the national grid for use by other consumers.
Aniagwu cited the 8.5MW Independent Power Plant located behind the state secretariat in Asaba as an example of what could be achieved through alternative power sources.
He said the facility had enabled the secretariat complex to operate independently of the national grid, thereby making the electricity that would otherwise have been consumed there available to other users.
He added that the planned 120MW partnership with Supply Power would further strengthen the state’s electricity supply capacity and provide a more reliable power base for small and medium-sized enterprises.
Aniagwu said the state government was also intervening in areas traditionally regarded as the responsibility of electricity distribution companies because inadequate power supply could no longer be allowed to constrain economic development. LearnQuantum Physics
He identified the extension of the electricity grid from Abraka towards the Ndokwa axis as one of the interventions being undertaken to connect more communities to electricity.
The commissioner, however, raised concerns over the burden placed on communities that are often required to provide transformers and other electricity infrastructure, only for distribution companies to take over the facilities and subsequently collect electricity bills without adequately accounting for the investments made by the communities.
He said the state would continue to support efforts aimed at energising communities, noting that improved electricity supply would stimulate businesses, create jobs and help tackle social problems associated with unemployment and idleness.
On regulation, Aniagwu said the government was working with the Ministry of Energy and a committee set up to develop an appropriate regulatory framework for the state’s emerging power sector. SwitchEnergy Plans
He said the proposed energy commission would be responsible for regulating new electricity producers, determining appropriate tariffs and overseeing distribution networks.
The commissioner stressed that liberalising the sector required effective regulation to protect consumers and investors, adding that decisions on power distribution infrastructure, including the use of overhead or underground lines, must take into account the peculiarities and safety requirements of each location.
He warned that power expansion without adequate regulation could expose residents to electrocution and other hazards, stressing the need to protect electricity infrastructure while ensuring consumers were not subjected to unfair pricing.
Aniagwu said the state government’s broader objective was to build an efficient and sustainable electricity market driven by private investment and capable of powering businesses, households and communities across Delta State.
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