NLNG Attributes Surge in Cooking Gas Prices to Vessel Scarcity, Forex Fluctuations, and Rising Oil Costs

The Nigeria Liquefied Natural Gas Limited (NLNG) has cited vessel scarcity, fluctuations in foreign exchange rates, and the increasing prices of oil as the primary factors behind the recent escalation in cooking gas prices. According to a market survey conducted, the price of 20 metric tons of cooking gas at the terminal surged from N10 million at the beginning of the month to N14 million by October 20.

In an official statement released on Wednesday, NLNG explained that these factors, coupled with domestic macroeconomic changes and global influences, have contributed to a contraction in the supply of Liquified Petroleum Gas (LPG) within the domestic market. The company acknowledged the dynamic nature of the LPG market, attributing recent price hikes to changes in exchange rates, escalating price benchmarks linked to crude oil prices, and vessel scarcity induced by the Panama Canal drought, affecting transport costs for imported LPG.

NLNG emphasized its role in the growth of the Domestic Liquified Petroleum Gas (DLPG) market, noting an increase from less than 50,000 metric tons of imported LPG in 2007 to over 1.3 million metric tons of both domestic and imported LPG today. Despite challenges in feed gas supply, NLNG remains actively involved in LPG deliveries, ensuring a consistent supply of cooking gas nationwide.

The company revealed its commitment to delivering over 450,000 metric tons per annum of Butane, the main component in cooking gas, and has initiated domestic propane supply to further expand the market. NLNG, despite feed gas challenges, continues to supply LPG to the domestic market, accounting for approximately 40 per cent of the total market volume.

Since the beginning of the year, NLNG has delivered over 380,000 metric tons of LPG using its dedicated LPG vessel. The company affirmed its unwavering commitment to ensuring a reliable supply of LPG production to the domestic market at prices reflective of market conditions. NLNG is collaborating with relevant industry stakeholders to achieve this objective and remains focused on its mission.

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