NLNG, a major player in the global liquefied Natural Gas, has revealed there are three major factors around the domestic macroeconomic developments as well as global factors that have combined to constrain adequate supply in the domestic market.
According to Nigeria Liquefied Natural Gas (NLNG) Limited, the three reasons the price of gas is skyrocketing are vessel scarcity, forex, and oil prices.
The company made this statement on Wednesday, November 8.
The statement reads: “The domestic LPG market, like any other, is subject to dynamic market forces and various external factors. Such factors as changes in exchange rates, escalating price benchmarks mirroring crude oil prices, and the Panama Canal drought-induced vessel scarcity impacting transport costs, especially for imported LPG, have had significant effects on energy prices in recent times and could undoubtedly be some of the reasons for recent price hikes witnessed in the domestic market’’
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In essence, the average price of 1kg cooking gas has gone up by 61 percent to N1,200 from N696 it sold in June 2023.
The statement reads in part: “NLNG has been making contributions to the domestic LPG market, spurring the steady growth of the nation’s Domestic Liquefied Petroleum Gas (DLPG) market volume from less than 50,000 metric tons of imported LPG in 2007 to over 1.3 million metric tons of both domestic and imported LPG today. “NLNG currently delivers over 450,000 metric tons per annum of Butane, the main product in cooking gas, and has embarked on domestic propane supply to further grow the market. The Company has committed its entire Butane and Propane production to the domestic market from 2023 and despite feed gas challenges, continues to supply LPG to the domestic market, accounting for approximately 40% of the total market volume. “Since the beginning of the year, NLNG has delivered over 380,000 metric tons of LPG using the Company’s dedicated LPG vessel. NLNG maintains an unwavering commitment to ensuring the reliable supply of its LPG production to the domestic market at prices that are reflective of the market. The Company is collaborating with relevant industry stakeholders to achieve this objective and will remain focused on achieving its mission.”
