President of the Dangote Group, Alhaji Aliko Dangote, has assured Nigerians of a reduction in the price of Liquefied Petroleum Gas (LPG), popularly known as cooking gas, as part of efforts to ease the cost burden on households.
Speaking during a recent visit by members of Lagos Business School CGEO Africa to the Dangote Refinery in Lekki, the billionaire industrialist said his company has started daily production of 22,000 metric tonnes of LPG, out of which 2,000 tonnes are being prepared for immediate local distribution.
Dangote noted that the current market price of LPG, ranging between N1,000 and N1,300 per kilogramme, is unaffordable for many citizens who still rely on firewood and kerosene to cook.
“We are working hard to crash the price of LPG and make it affordable. If existing distributors are not willing to sell at reduced prices, we will take the product directly to the consumers,” Dangote said.
The refinery, which also plans to begin nationwide distribution of petrol, diesel, and aviation fuel from August, has reportedly procured 4,000 compressed natural gas (CNG) buses to support the logistics chain.
However, the move to cut LPG prices has triggered concerns among operators in the gas sector, who fear a possible monopoly.
Operators Raise Concern
Industry players have voiced their opposition to Dangote’s planned direct sale of LPG to end users, describing it as a potential threat to market competition.
Former Chairman of the LPG and Natural Gas Downstream Group of the Lagos Chamber of Commerce and Industry, Mr. Godwin Okoduwa, described the move as monopolistic.
“I think the plan is monopolistic. The LPG industry in Nigeria grew from 70,000 metric tonnes in 2007 to over 1.3 million tonnes by 2022, thanks to collaboration between the government, NLNG, and private investors. Growth should be inclusive, not one-sided,” he said.
Okoduwa urged Dangote to join hands with existing stakeholders to expand access to LPG, rather than take over a system that others have worked hard to develop.
“There’s still a lot of room to grow. Nigeria’s per capita LPG consumption is under 6kg, while countries like South Africa, Morocco, and Tunisia are doing far better. The focus should be on expanding the market, not edging out investors,” he added.
He recommended that Dangote should invest in LPG infrastructure in under-served regions like the North-East, where gas consumption remains very low.
Marketers Doubt Feasibility
On his part, the Executive Secretary of the Nigerian Association of Liquefied Petroleum Gas Marketers, Mr. Bassey Essien, expressed doubts about the possibility of Dangote selling LPG directly to consumers at significantly cheaper rates.
“It is not realistic. Has the refinery even started selling petrol directly to private car owners at cheaper prices? Let’s be sincere with ourselves,” Essien said.
He warned that bypassing existing distribution channels may lead to disruptions in the market and discourage further investments.
Despite the pushback, Dangote remains firm on his commitment to drive down prices and encourage the transition from firewood and kerosene to cleaner and safer LPG.
