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NLPGA, others seek end to cooking gas pricing, value-chain crisis

By Femi Adekoya
01 December 2021   |   3:00 am
To avoid a decline in domestic gas utilisation as a result of various challenges in the value chain, operators in the gas value chain, under the aegis of the Nigeria Liquefied Petroleum Gas Association

Liquefied Petroleum Gas (LPG) cylinders . Photo: Ulrike Leone / Pixabay

To avoid a decline in domestic gas utilisation as a result of various challenges in the value chain, operators in the gas value chain, under the aegis of the Nigeria Liquefied Petroleum Gas Association (NLPGA), are engaging with the agencies of the Federal Government to find ways of addressing pricing issues as it relates to Liquefied Petroleum Gas (LPG), otherwise known as cooking gas.

The President of NLPGA, Nuhu Yakubu, during the association’s 11th International Conference and Exhibition, held in Lagos with the theme: “Market Growth and Fiscal Regulations -Rethinking the LPG Supply Gaps Amid the Challenging Regulatory Environment,” noted that the business environment needs to be friendly for everyone.

“As an association, we are currently engaging with respective government agencies in addressing issues around LPG supply, particularly access to foreign exchange, value-added tax, levies, etc. We believe our efforts will yield positive results in a good time,” Yakubu said.

He added that sustaining the growing adoption of LPG through sector-friendly policies and programmes would support economic growth that would yield jobs and wealth creation, explaining that it was the collective responsibility of all stakeholders in the LPG sub-sector to make it happen.

He said that in line with the seventh item in the Sustainable Development Goals (SDGs), deepening education on the role of diverse applicable uses of LPG was critical as the world aims to provide cleaner, reliable, sustainable and affordable energy sources for everyone by 2030.

According to him, worthy of mention is the declaration of the “Decade of Gas” by the Minister of State for Petroleum Resources, Mr. Timipre Sylva, with the support of President Muhammadu Buhari, which he said was a worthy policy action.

In a communiqué issued at the end of the event, experts noted that Nigeria has very huge gas reserves of over 200 trillion standard cubic feet (tscf) but that the current business environment has not been friendly.

Consequently, the NLPGA urged the Federal Government to create an enabling environment capable of attracting and retaining massive investments into the LPG sector.

The organisation said that the Petroleum Industry Act (PIA) should be implemented in a manner that will encourage massive domestic and foreign direct investments required to stimulate sustainable growth while creating many multiplier effects, including jobs for Nigerians.

It added: “That such new investments are required to reduce Nigeria’s current dependence on imported LPG as well as meet rising future demand based on increased population. That the government should be consistent in the conceptualisation and implementation of policies needed to ensure stability in the LPG sector.

“That relevant stakeholders need to be involved and carried along in the process of taking new decisions to ensure successful implementation of PIA. That the imposition of the 7.5 per cent Value Added Tax (VAT) has negatively affected the sector in many unintended ways and should be eliminated.

“That the high prices of LPG have shifted the demand to firewood and charcoal, thus fuelling desertification and erosion with a very negative impact on the environment. That a package of new incentives should be introduced to stimulate investment, processing and utilisation of LPG in Nigeria in line with the nation’s Decade of Gas agenda.”