According to the federal government, Nigeria presently produces around five million tonnes of Liquefied Petroleum Gas (LPG) per year, with only 8% of the output used domestically and the remainder exported.
From the report, local LPG production accounts for around 45 percent of yearly demand, with Nigerian Liquefied Natural Gas Limited (NLNG) delivering 450,000 metric tonnes per year and imports accounting for the remaining 55 percent.
Special Adviser to the President on Economic Matters in the Vice President’s Office, Adeyemi Dipeolu, made the announcement during the India-Nigeria Liquefied Petroleum Gas (LPG) Summit in Abuja, 2022.
Mr Dipeolu stated in his keynote presentation that Nigeria has the ninth greatest proven natural gas reserves in the world and is the second largest LPG producer 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 percent LPG, 65 percent biomass and 30 percent kerosene,” Dipeolu said.
Mr Dipeolu pinned the preference for alternatives to the high cost of cylinders and the general lack of knowledge about gas.
“There is also the high cost of LPG in comparison with alternative fuels, insufficient and inappropriate cylinders in circulation and inadequate infrastructure, especially truck, roads, rail pipeline and plants,” he added.
He said that the primary use of biomass for domestic cooking results in deforestation and ambient air pollution, which might lead to medical conditions like stroke, heart disease, lung cancer, and chronic respiratory disorders.
Mr Dipeolu expressed hope that Nigeria will benefit from India’s experience with the Pradhan Mantri Ujjwala Yojana (PMUY) plan, which was adopted by the Indian government in May 2016 and has raised LPG penetration in that nation from 62% to 100%.
According to the special adviser, the recently implemented PIA promotes policies, incentives, and waivers to attract investment, hence enabling strong midstream and downstream gas development.
Others, he added, were the elimination of VAT on domestic LPG, the presidential waiver of duty on imported LPG equipment, a tax holiday on new gas investment, and the approval of eight new LPG terminals and storage facilities, which would add 150,000 metric tonnes of gas capacity.
