Cooking gas marketers warn of impending hike in LPG price

…May skyrocket to N4,000 for 12.5kg

The Nigerian Associa­tion of Liquefied Pe­troleum Gas Market­ers (NALPGAM) yesterday warned of an impending hike in the cost of cooking gas effective next week.

Addressing the media in Lagos yesterday, President of NALPGAM, Mr. Basil Og­buanu, explained that the mar­keters are protesting against what they called “the sudden increase of LPG price” by AL­GASCO LPG Services.

ALGASCO markets LPG at its Creek Road terminal in Apapa, Lagos, which is oper­ated by Navgas.

Ogbuanu explained that ALGASCO, without recourse to stakeholders, unilaterally in­creased the price of LPG from N3.3 million to N3.5 million for 20 metric tonnes of LPG, even as the Mont Belvieu LPG price, which is the international pricing model used by the Ni­geria Liquefied Natural Gas (NLNG) Limited to sell gas to the domestic market, has not increased its price.

The President alleged that it has become the culture of ALGASCO to increase price at will whenever it is the only terminal with the commodity, adding that its huge storage capacity of 8,000 metric tonnes is also a factor it uses to exploit marketers.

He said the association wrote the Managing Direc­tor of the firm on September 15, 2014, in protest against the hike, a copy of which was made available to Daily Sun.

The letter reads in part: “We hereby write in respect of the sudden increase of LPG price by your company. Our objec­tion to the sudden increase is because this act is not in line with the aspiration of the Fed­eral Government to encourage the populace on LPG usage,” the letter said.

Presently, the NALPGAM boss said the price of crude oil is reducing, stressing that this is one of the parameters used in fixing the price of LPG by NLNG Limited, hence, there was no justification for the sud­den increase, which, he said, will have adverse effect on LPG consumption across the country.

Regrettably, he noted that the company forced the off-takers who subsequently sell to marketers not to sell below N3.5 million for 20 metric tonnes of LPG, after the off-takers had already sent mes­sages to marketers that the product was available for N3.3 million.

“This is just a case of arm-twisting because the off-takers cannot sell below what AL­GASCO is selling. It is just a situation of landlord and ten­ant. It’s either you abide by the wish of your landlord or you move out. The off-takers are using their facilities to dis­charge products to marketers,” he disclosed.

Ogbuanu, however, called on the Minister of Petroleum Resources to call on the man­agement of the company to rescind its decision in order not to make a mess of the efforts of government and stakeholders in the LPG sector in ensuring that the usage of LPG is deep­ened.

On the implication of the hike, he said effective next week, the price of LPG would skyrocket to about N4,000 for 12.5kg for those selling in La­gos while it will be more for those outside Lagos as a result of cost of transportation and other logistics.

Source : SunOnline

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