LPG: No immediate plan to ban cylinder imports — FG

The Federal Government says it has no immediate plan to ban the importation of gas cylinders as part of its LPG expansion and implementation plan.

The Senior Special Assistant on Domestic Gas in the office of the Vice-President, Mr Dayo Adesina, made the disclosure in an interview with our Correspondent on Sunday in Abuja.

He said that the government was working on first building local capacities before contemplating a ban.

According to Adesina, who is also the Programme Manager of the National LPG Expansion and Implementation, Nigeria still has a lot of cylinder deficits to fill in meeting the LPG expansion plan.

He explained that the plan was to get LPG to the remotest of villages and discourage use of firewood and other fuels that are inimical to the environment.

Adesina said that of the nation’s over 200 million population, there are only about two million gas cylinders, which he said, is poor compared to other countries.

He pointed out that Brazil, with a population similar to Nigeria, has a cylinder population of 150 million and an additional five million injected annually.

He said that for India, the cylinder population is over 100 million while Mexico has a cylinder population of almost 100 million.

“But Nigeria, with over 200 million people has less than two million cylinders. So, if you had 20 cylinder manufacturing plants it still won’t be enough.

“We have a new one that opened in 2019, two that are shut down and three that have sought approval for manufacturing. You cannot ban what you don’t have.

“Banning importation is not going to solve the problem. It is going to worsen the problem.”

He said that the government needs to move quickly to inject cylinders nationwide if it must keep its commitment to reducing emission.

Adesina, however, stressed that banning importation now would not be a solution but that Nigeria should rather build local capacity gradually until the nation can become self-sufficient in cylinder production.

“What the government is doing is simple: take a mixture of local and foreign production.

“The ones that are to be imported, the manufacturer can supply the first set, the second set must be manufactured locally in Nigeria.

“If they are not ready to set up here we pair them up with local investors and technical partners,” he said.

In the meantime,  Adeshina  has said government is targeting installation of five gas terminals to boost LPG penetration in the country.

According to him, “From 2017 to 2020, the market has moved from 750 thousand  tonnes to 1,175,000 tonnes and with government encouragement, there has been  about five new terminals to receive LPG  from NLNG, nationwide.

“This is coastal terminals that we could see products and not inland terminals,’’ he said.

He said that the terminals are located at Ogara, Warri, Port Harcourt, Calabar and Lagos.

“In July or latest August, another terminal will come on stream in Warri  and by last quarter of this year, first phase of Rano in Lagos will also come on stream.

“So there is a lot we are doing in terms of supply, we are engaging a lot of investors for the product terminals but outside of that, for sustainability, we are also engaging marginal field operators.

“Prior to now, a lot of Marginal Field operators will either re-inject the gas or flare it, we expect significant volume to come from Seplat Joint Ventures with the NNPC.

“Just in December, the NPDC a subsidiary of NNPC, came on stream, another one in Delta, Kwale hydrocarbon came on stream, Green energy hopefully this year should also come on stream.

“We are also closely monitoring PanOcean facility despite being with AMCON, hoping that significant volume will come from there all things being equal,” he said.

Adeshina further said that government was also engaging some International oil companies (IOCs) to access domestic gas supply obligations that they have.

He said that sustainability was key to the whole project, adding that government does not want to go into any subsidy as it had never been inefficient.

According to him, the focus of government is to ensure adequate supply and being a deregulated product, competition will help drive the price down.