FG stops LPG exports to lower cooking gas prices

The Federal Government has announced the suspension of locally produced Liquefied Petroleum Gas (LPG) exports, prioritizing domestic supply in a bid to curb rising cooking gas prices in Nigeria.

This new directive, set to take effect on November 1, 2024, was unveiled by the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, during a high-level meeting with key industry stakeholders in Abuja.

According to a statement released by the minister’s spokesperson, Louis Ibah, the government’s decision is aimed at tackling the skyrocketing cost of cooking gas, which has more than doubled in the past 16 months. From N700 per kilogram in June 2023, the price has surged to N1,500/kg by October 2024, marking a staggering 114% increase.

The minister emphasized the urgent need to stabilize the market, citing the hardships many Nigerians are facing due to the unaffordable cost of gas. In addition to halting exports, he directed the Nigerian National Petroleum Company Limited (NNPCL) and other LPG producers to either retain their locally produced LPG for domestic consumption or import equivalent volumes at cost-reflective prices.

Ekpo also set up a 90-day timeline for the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to work with stakeholders in creating a pricing framework. This framework will index LPG prices to in-country production costs, moving away from the current practice of linking prices to external markets like the Americas and Far East Asia.

To provide a long-term solution, the government plans to develop facilities for blending, storing, and delivering LPG within 12 months. These measures are designed to halt LPG exports until the domestic market achieves both sufficiency and price stability.

The minister’s move is seen as a critical step toward ensuring that Nigerians have access to affordable cooking gas, a necessity in a country that produces the commodity in abundance yet faces rising prices.