The Nigeria LNG Limited (NLNG) has refuted recent media reports that LPG price in the domestic market has increased. In a statement signed by Kudo Eresia-Eke, General Manager, External Relations, NLNG stated that Nigeria LNG’s domestic LPG price is based on an international price index plus 50 percent of the shipping cost of delivering the product to receiving facilities in Apapa-Lagos.
“That price is invoiced in naira at the prevailing official interbank exchange rates, contrary to erroneous assertions made in parts of the media”, stated Eresia-Eke in the statement adding that although LPG is produced and consumed locally, the product like crude oil, is an internationally traded commodity with an international price benchmark, open to global demand and supply pressures.
According to Eresia-Eke, NLNG softens the impact of price variations by continuing to subsidise the cost of transporting about 40 percent of total domestic market share which it supplies from its production facility on Bonny Island.
NLNG stated that the recent delays to vessel discharges at the receiving facilities in Apapa, Lagos which are multi-use terminals with berthing priority accorded to vessels discharging other oil products (Petrol, DPK and Diesel), have also led to a temporary supply disruption over the last 2-3 weeks.
“For instance, NLNG’s dedicated LPG vessel has been unable to discharge LPG at the Apapa port since 29th December 2016 due to jetty unavailability, resulting in temporary product shortages in the market”, said NLNG.
The company said that they have continued to work with stakeholders including offtakers and terminal operators, to eliminate bottlenecks and improve operational efficiencies to ensure product availability and help correct market price distortions.
“We are also engaged with other public and private stakeholders along the domestic market value chain to stimulate price stability and growth”.
NLNG said that recent approval by its Board to increase in the LPG dedicated for supply into the domestic market from 250,000 metric tons to 350,000 metric tons annually is demonstration of commitment to the goals of ensuring LPG supply availability, reliability and affordability which are key for the development and growth of the Domestic LPG market.