THE reported high cost of Liquefied Petroleum Gas (LPG) or cooking gas might have added to the soaring cost of living and general hardship in the country. According to a recent survey, the price of cooking gas has increased by over 100 per cent from the beginning of the year till date. For example, the cost of 12.5kg of cooking gas that sold about N3,500 in 2020, has jumped to N6,000 in cities such as Lagos, Port Harcourt and Federal Capital Territory (FCT), and about N8,500 in many other states. It is also projected that the cost of 12.5kg cooking gas may hit N10,000 threshold by end of the year if the government does not intervene in tackling the identified problems in the gas sector.
If the rising cost of cooking gas is not checked forthwith, many Nigerians may likely resort to the use of firewood and charcoal for cooking, which will expose them to avoidable health hazards. In 2013, the World Health Organisation (WHO) revealed that indoor smoke from solid fuel or firewood was one of the leading causes of avoidable death and ill-health worldwide, with women mostly affected. The report also disclosed that about 98,000 Nigerian women die each year from the use of firewood, with thousands more at risk of serious health problems, just as over four million people die prematurely from illnesses attributed to household air pollution from inefficient cooking by using kerosene stoves.
The government should not leave Nigerians with these deadly cooking alternatives that are fraught with numerous health risks. Many stakeholders in the gas sector have alleged that importers, depot owners and the Federal Government are complicit in the present hike in the price of cooking gas through arbitrary price-fixing. They also stated that the reintroduction of Value Added Tax (VAT) on locally produced LPG, which was removed in August 2018, has contributed to the sharp increase in the price of the product.
The imposition of VAT on imported LGP may have worsened the situation. While the high dependence on imported cooking gas is said to be a major factor in the price hike, the depreciation of the naira has not helped matters. It has been argued that since cooking gas is an internationally traded commodity, there is heightened fear that the skyrocketing price of the product may not come down anytime soon. It is disheartening and paradoxical that Nigeria produces and exports LPG while dealers go outside to import the same product for local consumption.
As a matter of urgency, the government must ensure the availability and affordability of cooking gas in the country. Let the gas sector be efficiently managed. A recent survey showed that gas products from NLNG and other sources, are hoarded owing to limited storage facilities. Therefore, the hoarding of the commodity will invariably lead to artificial scarcity and panic-buying. Other challenges confronting the gas sector include limited thermals, inadequate funds and poor policy implementation. These are issues that should be tackled urgently, while the government intensifies effort to reduce the importation of the product. The reintroduction of VAT on local gas production should be reversed as the Nigerian Association of Liquefied Petroleum Gas Marketers had enjoined. The association called for a policy that would encourage the full domestication of LPG. It also suggested that every local marketer should put the necessary machinery for storage of the product. Statistics show that the nation’s local consumption of LPG which hitherto stood at about 70,000 metric tons as at 2007 had increased to over one million metric tons as at December 2020. The domestic availability of the product has also reduced to 35 per cent, while importation has increased to 65 per cent.
While the cost of LPG was N3.4 million per 20 metric ton trucks by December 2020, it went up to N5.4 metric ton, and N5.6 MT in January this year, N6million per metric ton by February. The burden, as always, is pushed to the end-users. According to the marketers, the same quantity was sold to them at N8million in August. Nigeria is currently ranked 38th in the world for natural gas consumption, according to the World Gas Statistics Data. All the same, the soaring price of cooking gas is unacceptable. Therefore, let the government muster the political will to make the product available and affordable.