NLNG slashes LPG export as local prices bite harder

The Nigeria Liquefied Natural Gas(NLNG) Limited is reducing export of Liquefied Petroleum Gas (LPG) or cooking gas, pushing more volume into the domestic market as the country grapples with gas shortage.

“As part of the measures to support the federal government’s efforts to deepen domestic gas supply and economic growth, Nigeria LNG is reducing LPG exports and increasing supplies to domestic market,” NLNG managing director, Philip Mshelbila told participants in an industry conference organised by the National Association of Energy Correspondents (NAEC), in Lagos.

NLNG is now increasing supply to domestic market to 450,000 metric tons per annum, Mshebilia said.

It was supplying 250,000 mt/year to the domestic market and exporting the balance of its output to Western markets.

NLNG, a venture involving the state-owned NNPC and Shell, Eni and TotalEnergies, produces around 7 million mt/year of LPG (propane and butane) from the six trains.

To meet the rise in the supply volume, NLNG said, it had increased the number of offtakers to 43 from the initial six contracted in 2007.

Nigeria’s domestic LPG demand is projected to grow to 3 million mt/year by 2026, from 1 million mt now, according to government estimates.

The Chief executive of NNPC, Mele Kyari, said, Nigeria requires up to $2.7billion to revamp LPG and other gas distribution infrastructure in the country.

Oil producers have said they are prepared to channel investment in building the needed infrastructure to boost Nigeria’s domestic gas supply.

The managing director of Shell Nigeria Gas, Ed Ubong, said on Tuesday, that while much of the gas from Shell operated Gbaran-Ubie field which produces about 864 MMcf/d of gas is for export, the company is building infrastructure to deliver the gas to local industries.