The Nigeria LNG Limited (NLNG) says The price of LPG in the domestic market is dependent on several market factors, including the forces of demand and supply.
In a statement signed by its General Manager, External Relations and Sustainable Development, Eyono Fatayi-Williams, NLNG contributes to the supply shortfall of cooking gas in Nigeria and consequent price hike. On the supply side, NLNG plays a pivotal role in the Nigerian domestic LPG market in line with the commitment it made to help deepen the market.
Recently, the Company increased the volume of its annual commitment to the market from 350,000 to 450,000 metric tons, which is about 100% of its Butane production. Butane gas is less volatile and is, therefore, suitable for cooking.
The vessel’s delivery to these terminals, the company said are occasionally hampered by challenges at the terminal, including storage capacity, terminal access, draft restrictions, and prioritisation of other products over LPG.
NLNG’ says its current maximum Butane production meets about 40% of domestic demand. The balance is supplied by other domestic producers or via imports. Therefore, NLNG’s production alone is not sufficient. In order to achieve its aspiration for the domestic supply, a dedicated 13,000 metric ton vessel, LPG Alfred Temile, delivers the product to the market through Lagos and Port Harcourt terminals.
The vessel’s delivery to these terminals are occasionally hampered by challenges at the terminal, including storage capacity, terminal access, draft restrictions and prioritisation of other products over LPG”.
“By committing 100% of its Butane production, NLNG has prioritised the domestic market, thus realising its domestic supply target safely.
NLNG’s domestic LPG pricing is most competitive compared to all other alternatives (imported and domestic supply). However, it is important to note that several factors such as VAT, Forex, etc., impact the pricing of the product which is indexed to the international pricing model.
Liquefied petroleum Gas NLNG blames market factors for hike in price.