Following Nigeria LNG Limited’s (NLNG) announcement that it would only supply the domestic market, there has been a slight hike in the price of the commodity and its demand, cooking gas retailers in the country have identified the risk of this development.
BizWatch Nigeria had reported that NLNG disclosed that its board of directors resolved to stop exporting and would only supply the Nigerian market .
According to the company, the move was not only to deepen the utilisation of cooking gas in Nigeria, but to also ensure stability for the sake of the economy.
Reacting to the development, the National Chairman, Liquefied Petroleum Gas Retailers Association of Nigeria, Michael Umudu expressed worry that NLNG’s full capacity might not be able to serve the Nigerian populace.
Umudu further stated that while lack of competition may also give Nigerians problems, the country would experience an upsurge in the commodity’s demand from NLNG, which may create scarcity.
His words: “If they (NLNG) will match their words with action, it will be fine. This is because the 100 per cent they are talking about, will it meet the local demand for LPG?
“Even if it meets the current demand of about 1.2 million metric tonnes per annum, which I doubt, there will be an upsurge in demand, just like we are experiencing now. Again, we should be concerned about the factor of competition.
“This is because with the announcement, if care is not taken, some of the importers who started importing, leading to a reduction in price for about a month before that decision, may decide to stop imports believing that they will not be able to compete with NLNG.
“And if NLNG is not fit to supply the product, it can equally cause more problems. However, the decision is welcomed and the NLNG should be commended for it.”
