The Federal Government has halted the exportation of Liquefied Petroleum Gas, also known as cooking gas, to control its rising price in the domestic market.
In a statement on Tuesday, the Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, said the directive would take effect on November 1, 2024.
The statement signed by Mr Ekpo’s spokesman, Louis Ibah, said the decision was reached after the minister convened a high-level meeting in Abuja with stakeholders to address the skyrocketing price and its attendant hardship on Nigerians.
The price of cooking gas jumped from N700/kg in June 2023 when President Bola Tinubu assumed office to N1,500/kg in October 2024, an increase of about 114 per cent within 16 months.
In a move to tackle the soaring price of cooking gas, the minister established a high-level committee in November 2023 led by the Chief Executive of the NMDPRA, Farouk Ahmed, with key stakeholders in the LPG value chain.
However, despite this effort to address the issue, prices have continued to fluctuate, recently soaring to N1,500 from an average of N1,100 – N1,250/kg.
But the minister, in a new directive to reduce the price, gave short-term and long-term targets.
He said, “With effect from November 1, 2024, NNPCL and LPG producers are to stop exporting LPG produced in-country or import equivalent volumes of LPG exported at cost-reflective prices.”
In terms of the pricing framework, he directed the Nigerian Midstream and Downstream Petroleum Regulatory Authority to meet with stakeholders to derive the pricing framework within 90 days.
The statement added, “Pricing Framework: NMDPRA will engage stakeholders to create a domestic LPG pricing framework within 90 days, indexing price to cost of in-country production, rather than the current practice of indexing against external markets, such as the Americas and Far East Asia, whereas the commodity is produced in-country and the Nigerian people are required to pay much higher price for an essential commodity the country is naturally endowed with.”
Offering a long-term solution, the statement added that within 12 months, facilities will be developed to blend, store, and deliver LPG, ending exports until the market achieves sufficiency and price stability.
