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FG, NNPC to establish new gas company, to inject 20 million cylinders in 5 years

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Gas Cylinders

Nigeria National Petroleum Company (NNPC) Limited is collaborating with the federal government, through the Office of the Vice President on the establishment of Gas Funding Company Ltd for the injection of 20 million cylinders in the next 5 years.

NNPC said the company’s establishment, which involved collaboration with other relevant stakeholders and being done under the Marketer Cylinder Owned Model, would boost liquefied petroleum gas (LPG) penetration.

According to NAN, this was made known on Wednesday by the group managing director of NNPC, Mele Kyari, at the opening of the India-Nigeria Liquefied Petroleum Gas (LPG summit) in Abuja.

The India-Nigeria LPG summit, with the theme, “Energising the Future: Leveraging the Indian Experience to Achieve Nigerian National LPG Aspiration,” was hosted by the NNPC with the support of the Office of the Vice President and World LPG Association (WLPGA).

Kyari, who was represented by the group executive director, downstream of NNPC, Adeyemi Adetunji, said the summit would be required to submit a report detailing gaps identified and recommendations on best practices from the Indian experience, to achieve rapid National LPG penetration.

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He said the summit would equally discuss the Nigerian experience and Indian example covering safe LPG handling, pricing, and financial support.

The NNPC boss noted that this will enhance LPG affordability among the poor, communication strategies, ICT, and infrastructure as well as collaboration on Cylinder management and manufacturing.

What the group managing director of NNPC is saying

Kyari said Nigeria had identified its abundant gas resources as fuel for an energy transition, which informed its net zero commitments by 2060 and the declaration of 2021-2030 as a Decade of Gas.

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He said, “NNPC Ltd is an energy company with new investments in gas, power, and renewables. Key pipeline projects such as ELPS II, OB3, and AKK to deliver a total of 6.2 billion cubic feet of gas per day to demand nodes across the country are at various stages of completion.

“We have a strong presence in the LPG value chain contributing about 45% of domestic supply via JVs (Oso Bonny River Terminal) affiliates (Nigeria LNG Ltd and Ashtavinayak Hydocarbon Ltd) and subsidiaries of NPDC.

“The NNPC Ltd. is fully aligned with the federal government’s National Gas Expansion Programme (NGEP) and National LPG Expansion Plan initiatives and has a full-fledged LPG business unit established to commercially drive the National LPG penetration.

“Accordingly, NNPC Ltd is commissioned to deploy 740 LPG micro distribution centres (MDCs) 37 filing plants and skids in its 541 stations within the next three years.’’

What you should know

  • Recall that earlier in March 2022, Kyari said the NNPC was being transformed to be the fifth largest gas producing company in the world.
  • He noted that NNPC was currently working on a platform that would create a hub of gas industries that would potentially compress gas and deliver it with ease to the masses.
  • The federal government had in April 2021, said it would inject 5 to 10 million LPG gas cylinders into the market in the next year to improve safety and deepen LPG utilization, also known as cooking gas, in the country.
  • The National LPG Expansion Implementation Plan, domiciled in the Office of the Vice President, was committed to achieving Nigeria’s target of five million metric tons of LPG consumption annually by 2027.

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