A vista of investment opportunities in the downstream petroleum sector opened for entrepreneurs when Nigerians began to move away from the use of dirty fuels such as kerosene, firewood and charcoal, adopting the cleaner and more environment-friendly Liquefied Petroleum Gas (LPG) for domestic and commercial cooking.
Though Nigeria still ranks lowest in per capita usage of LPG with 1.1 kilogramme consumption rate behind South Africa, Morocco and Ghana, the intervention of the Nigerian Liquefied Natural Gas (NLNG) Limited has somewhat helped Nigerians to embrace the use of LPG.
Prior to the intervention of NLNG in the domestic gas market, the use of LPG was exclusively for the rich because the price was out of the reach of the common man as LPG was imported with annual consumption rate of 70,000 metric tonnes per annum.
The coming onstream of NLNG broke that monopoly and afforded a lot of Nigerians to begin the use of LPG as against the kerosene and other unconventional sources of energy.
The incursion of NLNG into the domestic gas market equally created massive investment opportunities for local players to key into the LPG value chain business.
Nigeria, according to statistics from the Nigeria Liquefied Petroleum Gas Association (NLPGA), currently consumes 385,000 metric tonnes of LPG per annum, up from the 2013 consumption of 250,000. This is even considered too low when compared with Ghana, Senegal, Cameroon and Kenya’s utilisation.
The board of directors of NLNG as part of efforts to deepen LPG penetration in the country, last week increased the dedicated volume of LPG supplied to the domestic market from 350,000 mtpa to 450,000 mtpa.
But in the face of growing opportunities in the LPG value chain, the threat of gas explosions appears to be fast spreading across the country.
Between March and October, three gas explosions occurred in different parts of Lagos: Abule Ado, Ajuwon and Baruwa, claiming several lives and destroying property worth several millions of naira.
But worried by the rising incidence of gas explosions in the state, the Lagos State House of Assembly has directed its Committee on Special Duties, to invite concerned stakeholders and agencies with a view to finding a lasting solution to the menace.
This was the resolution reached at an emergency plenary two weeks ago, after the member representing Alimosho Constituency 1, Bisi Yusuf, brought before the House the issue of the explosion that rocked Baruwa area of Ayobo Ipaja, in which five lives were lost and several property destroyed.
Speaking at the plenary, Yusuf, while recounting the incident, explained that it was a bad Thursday for the people of Alimosho after the explosion occurred and not only destroyed property worth millions of naira but also took lives.
The lawmaker noted that the House, during the 8th Assembly, came up with a resolution condemning siting of gas plants within residential areas, but that the resolution was not enforced by the necessary agencies.
Members, while lending their voices, condemned a situation whereby gas plants are sited within residential areas, just as they urged the state Ministry of Physical Planning and Urban Development to desist from approving siting of gas plants within residential areas.
Hon. Ganiu Sanni-Okanlawon, the member representing Kosofe Constituency 1, explained that the incessant gas explosion had become worrisome. He also advised that the concerned authorities and agencies should carry out proper enforcement of regulations relating to siting of gas plants.
When contacted, Head Public Affairs, Department of Petroleum Resources (DPR), Mr. Paul Osu, in a telephone interview with Sunday Sun said DPR by law does not demarcate which facility is residential or commercial area, saying that it’s strictly the responsibility of the Lagos State Physical Planning Permit Authority (LASPPA), an agency under the supervision of the Lagos Ministry of Physical Planning and Urban Development or that of any state.
He said that approval to construct a cooking gas plant is a multilateral agency role which involves getting clearance from the police to ascertain that the facility will not obstruct the free flow of traffic, Fire Service; that it is in a safe environment in case of fire incident and finally LASPPPA approval.
According to him, the three approvals will now be brought to DPR before the company could be issued site suitability approval.
In line with the 2020 guidelines recently released by the DPR (which can be found on www.dpr.gov.ng) any intending company wishing to establish an LPG refilling facility in the Nigerian gas industry must obtain the following: Site Suitability Approval, Approval to Construct (ATC)/Approval to Install and License to operate.
For the gas plant that was involved in the Baruwa explosion, Best Roof Gas, he said the company got approval to construct but when DPR came for inspection, they noticed that the company went out of the guidelines, hence he was not given license to operate.
Osu said that every LPG plant needs the license to operate to be able to load product at the LPG terminal because it is one of the statutory requirements needed before loading of product can take place.
He, however, disclosed that people who do not have such licenses approach firms that have the licenses to supply them products, adding that the truck that brought the product was actually meant to head to Ibadan, but diverted the product. That was why the workers at the facility did the offloading of the gas in the early hours of the morning.
But a senior official in the Lagos State Physical Planning Permit Authority (LPPPA), who pleaded not to be named because he was not authorized to speak, explained that the agency does not give approval for cooking gas plants to be sited in residential areas.
Rather, she explained that what people do is to come to get approvals for residential building, only for them to return to site and construct a gas plant.
‘‘When we get report of such regulatory breach, we mobilise and seal such premises in order to arrest any impending danger,” the source said.
Other guidelines included in the DPR requirements are: procurement of at least two dry powder extinguishers less than 9kg each suitable for LPG fires with a test fire rating of at least 21A and 183B as defined in MSA EN 3-7:2004, which should be readily available at strategic locations to deal with fires adjacent to the meter/vehicle being filled.
Adequate steps should be taken to prevent unauthorised interference with vessels and ancillary equipment such as lockable covers. When the site is closed, the equipment should be protected from unauthorised interference or operation by isolation of electrical supplies, locking nozzles and locking of cabinet doors of ancillary equipment.
All notices should be conspicuous and easily understood by those to whom they are directed.
Where possible they should conform to EN 92/58 – Safety Signs and Colours, or equivalent, and where relevant, to the Work Place (Provisions of MOSR, 1997)
The installation or construction of a liquefied petroleum gas storage tank, together with any associated pipe work connecting the system to a combustible appliance providing space or water heating, or cooking facilities should be designed, constructed and installed in accordance with the requirements set out in the Nigerian Liquefied Petroleum Gas Association guidelines if any or an internationally accepted code.