Post Views: 297 The Federal Government says it remains committed to achieving 5 million metric tonnes of domestic, commercial and industrial LPG utili...
The Federal Government says it remains committed to achieving 5 million metric tonnes of domestic, commercial and industrial LPG utilisation in 10 years.
Speaking at the Official Commissioning of Techno Oil’s LPG Cylinder Manufacturing Plant, in Lekki, Lagos, on Friday, June 7, 2019, Vice-President Yemi Osinbajo, said the government see the sub-sector creating up to 2m new direct and indirect jobs in Nigeria, with a possible 40% cooking gas adoption rate, or 13.8m households in 5 years. He expressed hope also that in 10 years, the adoption rate would have greatly improved to 33.3m households, representing 73% in 10 years.
At the inception of the Muhammadu Buhari administration in 2015, he recalled, one of the issues identified was an abysmally low domestic utilisation of Liquefied Petroleum Gas (LPG) in Nigeria of 9% penetration rate nationwide. This, he continued, was despite the country’s domestic LPG production of 3m metric tonnes (MT) per annum, lamenting the dependence far too long on biomass fuels (firewood) or traditional fuels (petrol and diesel) as our dominant fuel options.
The administration, he said, has also demonstrated its “commitment by establishing an Inter-Ministerial Committee and a multi-stakeholder national coordinating body – the National LPG Expansion Programme.
“We correctly identified that it was necessary to emphasize coordination and collaboration, as previous attempts in enhancing LPG utilisation failed because of a fragmented approach within the Federal Government.
“Since the implementation of the coordination reforms – including the creation of a dedicated Project Management Office – great progress has been recorded.”
This, he said, included the removal of 5% VAT from the domestic pricing of LPG, as a first step in giving domestic output an advantage against imported products, in addition to the development of a Marketer Cylinder Owned Model instead of the current Consumer Cylinder Owned Model.
“This will eliminate the consumers’ up-front purchase of LPG cylinders which in some cases are substandard, replacing it with a cylinder exchange, whereby the consumer only pays for the content. No household will need to purchase or own an LPG cylinder. The Cylinders will be delivered and retrieved by the Marketers who will also be responsible for the maintenance and refurbishment of the cylinders, making LPG accessible to a whole new segment of non-LPG users.”
There is also the strengthening of the regulatory framework for the sub-sector, he stressed, assuring of the government continued active support for “every effort to promote the use of LPG in Nigeria, as well as create and maintain an effective and catalytic regulatory environment.”
The investment, the Vice President continued, auspiciously converges with government’s efforts to speedily diversify our economy, especially through domestic and indigenous solutions.
Government, he continued, is determined “to prioritise the LPG sector development culminated in the Federal Executive Council’s approval of the National Gas policy in 2017, with dedicated input for the enhancement of the LPG sub-sector. Our driving vision has been to transform the sub-sector from a commodity sector based on export to a value creation sector based on domestic utilisation and industrialisation.”
He commended the management of Techno Oil for making the substantial investment in the development of the gas sector, assuring of government’s determination to ensure the company succeeds.