High Domestic Gas Price To Crash As NNPC Set To Increase Supply

Hopes of Nigerians for a reduction in the high prices of domestic cooking gas was on Monday rekindled following the revelation by the Nigerian National Petroluem Company to increase supply of the products to the domestic market.

The Group Managing Director of the NNPC Ltd, Mr Mele Kyari, disclosed this in Abuja while speaking with reporters shortly after inaugurating Emadeb Energy Services Limited’s 120MT LPG Storage and Bottling Plant.

The increase in the prices of Liquefied Petroleum Gas (LPG) otherwise known as cooking gas has brought pains and hardship to Nigerians who relied on the product for preparation of their meals.

Many Nigerians had expressed concern that with the yuletide fast approaching, it may be difficult for them to enjoy the festivities with the price of gas far going beyond their means.

Residents of Abuja, Lagos and Port Harcourt among others currently pay between N8,500 and N9,500 to refill their 12kg gas cylinders. The price as of the beginning of this year was between N3,500 and N4,500.

But the disclosure by the NNPC GMD of a reduction in price through an increase in supply of the products is expected to put smiles on the faces of Nigerians as they prepare for the Christmas and New Year celebrations.

Speaking on the development, Kyari explained that the rise in the price of cooking gas was a reflection of the rising price of crude oil and its derivatives at the international market.

The price of crude oil as of Monday was put at $72.68 per barrel.

The NNPC GMD expressed optimism that the newly-inaugurated LPG plant would reduce the cost of energy for Nigerians.

He said, “The price would soon crash once the NNPC raises its supply of the product. Two things are at play; one is the supply and the other is the international price of gas.

“It (price) moves with the price of every other petroleum product including crude oil and its derivatives. So it is a reflection of what is happening in the international market.

“What we are doing is to increase supply. Once supply is increased the prices will come down.”

Before the passage of the PIA which overhauled the country’s rich oil and gas industry, President Muhammadu Buhari had in March declared 2021 to 2030 the ‘decade of gas.’ The energy source is seen as cleaner than fossil fuel

Kyari said one of the many ways investors could key into the decade of gas initiative was to have facilities such as this for auto-gas conversion, and also to ensure that LPG is easily accessible by the people.

He expressed optimism about the company’s plan to, within the next 12 to 18 months, build a similar plant in six different locations countrywide.

He specifically noted that the company had gone into these ambitious ventures in line with PresidentBuhari’s decade of gas initiative.

Before inaugurating the plant, Kyari had expressed satisfaction that numerous partners were keying into government’s aspirations of providing cheaper gas for the country.

He pointed out that the development would culminate in tapping from the enormous gas resources in Nigeria.

Kyari also said that this would also lead to extensive domestic utilization of gas and export of the product as well as result in energy security, peace and prosperity of the country.

He pledged the NNPC’s support for Emadeb Energy Services Limited in terms of supply and provision of information to promote business investments in the country.

The GMD added, “We are aware that a lot of institutions and companies are doing this across the country. We are selecting this in line with Mr President’s objectives to make this the decade of gas.

“We think this is a very nice step. This company has promised to make six of these facilities available within the shortest period of time. Ultimately, we know this will serve the people within this area. We are expecting more Nigerians companies to come into this.”

Kyari also noted that the global energy transition had made the investment climate very ripe for gas even as he assured those investing in LPG project that the NNPC would guarantee supply of gas to their facilities.

“We know that the investment climate is very ripe for auto-gas and auto fuel, especially in terms of LPG as a transition fuel globally. So, we know that this is a big market for Nigerian companies and this is one of the great companies (referring to Emadeb Energy Services Limited) that we have around.

“As NNPC, we will come in and we will guarantee supply. That is very important for us as a business. As you are aware, we are NNPC Limited in Nigeria and we also have to make money for Nigeria. We will be there in the upstream to provide the gas.

“The gas will be available through many of our initiatives, including all the truck lines we are trying to put in place. So, gas will be available to these companies and entities. Also we can share data with them around customers and how we can deliver gas to our customers,” he noted.

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