12 January 2017, Lagos – Nigeria LNG Limited on Wednesday said it has approved an increase in the Liquefied Petroleum Gas dedicated for supply into the domestic market from 250,000 metric tonnes to 350,000 metric tonnes annually.
It, however, said its dedicated LPG vessel had been unable to discharge the product at the Apapa port since December 29, 2016 due to jetty unavailability, resulting in temporary product shortage in the market.
The price of LPG, popularly known as cooking gas, had soared to N5,000 per 12.5kg from N3,200 in December.
The NLNG said the recent delays in vessel discharges at the receiving facilities in Apapa, Lagos had also led to a temporary supply disruption over the last two to three weeks.
According to a statement signed by the General Manager, External Relations, NLNG, Kudo Eresia-Eke, Nigeria LNG’s price is based on an international price index plus 50 per cent of the shipping cost of delivering the product to receiving facilities in Apapa-Lagos.
It said, “That price is invoiced in naira at the prevailing official interbank exchange rates, contrary to erroneous assertions made in parts of the media.
“The reality of this is that although the LPG is produced and consumed locally, the product, like crude oil, is an internationally traded commodity with an international price benchmark, open to global demand and supply pressures.
“The NLNG, however, softens the impact of price variations by continuing to subsidise the cost of transporting about 40 per cent of total domestic market share, which it supplies from its production facility on Bonny Island.”
The NLNG said it would continue to work with stakeholders, including off-takers and terminal operators, to eliminate bottlenecks and improve operational efficiency to ensure product availability and help correct market price distortions.
It said, “We are also engaged with other public and private stakeholders along the domestic market value chain to stimulate price stability and growth.
“The NLNG said it would remain fully committed to the goals of ensuring the LPG supply availability, reliability and affordability, which are critical for the development and growth of the domestic LPG market.”