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Scarcity, high cost of LPG traced to lack of space for arriving vessel to berth

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The Nigeria Liquefied Natural Gas (NLNG) has blamed scarcity and high cost of Liquefied Petroleum Gas, LPG, nationwide on the inability of its LPG vessel to berth and discharge its contents at the Apapa ports since December 29, 2016.

The main cause of the delay according to Business Hilights survey was due to congestion of the port facility.

NLNG, in a statement by its General Manager, External Relations, Kudo Eresia-Eke said: “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. Nigeria LNG’s domestic LPG price is based on an international price index plus 50 per cent 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.

“The reality of this is 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.

“NLNG however softens the impact of price variations by continuing to subsidise the cost of transporting about 40 per cent of total domestic market share which it supplies from its production facility on Bonny Island.”

Again, before the end of January, scarcity of Kerosene and diesel will ease as the Nigerian National Petroleum Corporation (NNPC) has resumed production at Kaduna, Port Harcourt and Warri refineries.

In a statement, NNPC said the refineries started producing both commodities since Saturday, and were currently producing more than six million litres of kerosene and seven million litres of diesel on a daily basis.

The corporation is upbeat that the resumption of refining of AGO and DPK was expected to balance the disequilibrium in demand and supply of the products being experienced in parts of the country.

On the production level of the Warri refinery, Managing Director of the Warri Refining and Petrochemical Company, WRPC, Mr. Solomon Ladenegan, said the plant had been doing well since the Crude Distillation Unit, CDU, was revved up on Saturday, January 7, 2017.

Ladenegan said “This morning (yesterday), we have pumped the products to PPMC and they have started loading. They are going to load up to one million litres of DPK and AGO. The products are there in the tank and we are doing everything to get them to the market.”

Besides, Managing Director of the Port Harcourt Refining Company, PHRC, Mr. Bafred Enjugu, also said the Port Harcourt refinery was producing three million litres of AGO daily, in addition to millions of DPK being churned out by the refinery daily.


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