Nigerian Company Launches Lagos LPG Terminal To Crash Cooking Gas Prices
- Asiko Energy Holdings Limited completed a 5,000-metric-tonne LPG terminal in Ijora, Lagos, nearly 20 years after the project was conceived.
- The terminal connects to three major jetties and allows Asiko Energy to blend cheaper LPG supplies to meet domestic standards.
- Nigeria's LPG supply gap remains wide, with NLNG's 500,000 tonnes of annual domestic production covering only about 40% of national demand.
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Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
Asiko Energy Holdings Limited has completed a 5,000-metric-tonne Liquefied Petroleum Gas (LPG) and propane terminal in Ijora, Lagos, with the company saying the facility will help it source cheaper cooking gas supplies and reduce prices for Nigerian consumers.
The completion ceremony took place on Tuesday, September 30, with the company's Managing Director and Chief Executive Officer, Felix Ekundayo, saying the terminal was built to enable Asiko Energy to access a broader pool of LPG producers, including suppliers offering lower-cost products that do not initially meet domestic specifications.
Source: Getty Images
Ekundayo said:
"There are other producers out there that make LPG that is cheaper. It's not the right specification, but it can be blended to make the right specification, which will help us drop down the price of cooking gas."
He added that the blending capability would give the company greater flexibility in sourcing and pricing LPG, which he said was one of the key reasons for developing the terminal.
Terminal infrastructure and construction
The facility is connected to three of Nigeria's largest LPG delivery jetties through about two kilometres of underground pipeline running towards Apapa, Punch reports.
Ekundayo said the connection would enable the terminal to receive cargo shipments while reducing logistical constraints.
The construction involved about 4,000 truckloads of sand, more than 6,000 tonnes of steel and 1,500 stone columns sunk to a depth of 13.5 metres.
The project was supported by the Midstream and Downstream Gas Infrastructure Fund, alongside financing from the Bank of Industry, Stanbic IBTC, Wema Bank and InfraCredit.
Asiko Energy Chairman Alex Ogedegbe said the project took nearly two decades to move from conception to completion.
He described the project as evidence that government-backed intervention funds could help unlock private capital for major gas infrastructure projects, Guardian reports.
The company said it plans to expand the terminal in its next phase to include LNG storage and distribution.
Source: Getty Images
Nigeria's LPG supply gap
At the ceremony, Nigeria LNG Limited Managing Director Adeleye Falade said the country's gas infrastructure had not kept pace with rising domestic demand.
Falade said NLNG had directed all its LPG output to the Nigerian market since 2022, with production rising to about 500,000 tonnes annually.
He said:
"As of last year, we were already producing in-country 500,000 tonnes of LPG, but guess what? It's now just about 40 per cent of the country's demand."
The supply gap has contributed to elevated cooking gas prices, with LPG selling for about N1,400 to N1,500 per kilogramme, putting pressure on households and businesses that rely on the fuel.
Cooking gas prices rise
Earlier, Legit.ng reported that the National Bureau of Statistics (NBS) reported that the average retail price for refilling a 5kg cylinder of Liquefied Petroleum Gas (LPG), commonly known as cooking gas, rose by 13.73% on a month-on-month basis.
The report also showed that the average retail price for refilling a 12.5kg cylinder of LPG rose by 13.89% month-on-month.
Lagos recorded the highest average price for refilling a 5kg cylinder at N9,745.10.
Source: Legit.ng
