To emphasise domestic supplies, the federal government has halted the export of locally generated Liquefied Petroleum Gas, commonly referred to as cooking gas.

Ekperikpe Ekpo, the Minister of State for Petroleum Resources (Gas), announced the plan on Tuesday. It will go into effect on November 1, 2024, and is meant to help reduce the skyrocketing cost of gas.

Louis Ibah, the Minister’s spokesperson, made this announcement in an Abuja statement.

The decision was made, according to Ibah, after the minister called a high-level conference with stakeholders in Abuja to discuss the soaring costs and the misery they were causing Nigerians.

Around the time President Bola Tinubu took office in June 2023, the price of cooking gas, also known as liquefied petroleum gas, jumped from N700/kg to N1,500/kg in October 2024.
This amounts to around a 114% gain in just 16 months.

The Minister formed a high-level group in November 2023 to address the skyrocketing cost of cooking gas. The committee was chaired by Mr Farouk Ahmed, the Chief Executive of the NMDPRA, and included important players in the LPG value chain.

Prices have fluctuated despite this attempt to solve the problem, most recently rising to N1,500 per kilogramme from an average of N1,100 to N1,250.

However, the minister set both short- and long-term goals in a new price reduction directive.

“NNPCL and LPG producers are required to cease exporting domestically produced LPG as of November 1, 2024, or import equivalent volumes of LPG exported at cost-reflective prices,” he stated.

Regarding the pricing structure, he gave the Nigerian Midstream and Downstream Petroleum Regulatory Authority 90 days to meet with interested parties and develop a price structure.

The statement also stated, “Pricing Framework: NMDPRA will work with stakeholders to develop a domestic LPG pricing framework within ninety days, indexing the price to the cost of domestic production instead of the current practice of indexing against external markets, like those in the Americas and Far East Asia, where the commodity is produced domestically and Nigerians must pay a significantly higher price for an essential commodity that the country is naturally endowed with.”

The statement offered a long-term solution, stating that facilities to mix, store, and supply LPG will be built within a year, halting exports until the market reaches price stability and sufficiency.

According to the statement, the Minister was deeply concerned about the nation’s ongoing rise in the cost of cooking gas, also referred to as liquefied petroleum gas.

In order to solve the underlying issues and guarantee that Nigerians have access to reasonably priced cooking gas, Ekpo issued these recommendations.