By YANGE IKYAA
The Federal Government has said it is going to leverage the Gas Development Fund of the Central Bank of Nigeria (CBN) and its pricing framework to create appropriate funding models that will support and ease the use of gas among vulnerable and low-income Nigerians.
This is with a view to encouraging the use of gas as domestic and vehicular fuels that is cleaner and less harmful to the environment by means of tackling the price hike of the commodity.
The Minister of State for Petroleum Resources, Chief Timipre Sylva, stated this at the weekend during the inauguration of a 100-metric tonne LPG storage and bottling plant, constructed by Butane Energy Limited in Kabukawa, Katsina State.
Sylva, represented by the Permanent Secretary of the Ministry, Dr. Sani Gwarzo, explained that the pricing of LPG was a major threat to gas affordability and penetration in the country.
He said the declaration of Decade of Gas by President Muhammadu Buhari, was to reinforce Nigeria’s aspiration to leverage on its gas resources estimated at 206 TCF to develop the country’s national industrial, commercial and agricultural base.
He reiterated that the federal government had embarked on numerous gas-based initiatives such as the Nigeria Gas Flare Commercialisation Programme, the National Gas Expansion Programme (NGEP), and the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline to accelerate economic development.
“I cannot conclude this speech without touching on gas pricing which is a major threat to gas affordability and gas penetration.
“The federal government is leveraging on the gas pricing framework and the CBN gas development fund to create appropriate funding models to support offtake of gas especially among vulnerable groups”.
He added, “The deliberate focus of this administration to develop the gas sector is largely the driving force behind NCDMB commercial intervention in partnering with the private sector, to establish Butane LPG bottling plant in several northern states including Katsina, Kano, Kaduna, Bauchi, Niger, and the FCT,” he stated.
The minister averred that the passage of the Petroleum Industry Act of 2021 by President Buhari has reinforced the government’s commitment to transform the oil and gas industry by creating an enabling environment for accelerated investment in exploration and field development projects.
This, he said, would pave the way for the integration of host communities into the benefit plans of the industry and entrenchment of local content as the driving philosophy for oil and gas transactions in Nigeria.
“In effect, the PIA and the intensive investment in gas transportation, storage, and marketing infrastructure will no doubt increase per capita consumption of gas in Nigeria which currently stands at 80 cubic meters per capita consumption despite our huge gas reserves”.
Earlier, the Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Mr. Simbi Wabote, said despite the utilisation of 1,000,000 metric tonnes of LPG in 2020, Nigeria has one of the lowest per capita LPG consumption in Africa.
He affirmed that available data from the office of the National Gas Expansion Programme revealed that LPG utilisation in the North-west was four per cent compared to 14 per cent in the South-west and 15 per cent in the South-east.
“That is why we chose to partner Butane Energy to increase the level of LPG utilisation in the North as they understand the market in the region, possess the technical capability and the determination to embark on such a venture,” he added.
In his remarks, the Chairman of Butane Energy Limited, Mr. Isa Inuwa, said by September, the company would have five gas plants with a total storage capacity of 820 metric tonnes.
He noted that the five gas plants would be located in Kano, Katsina, Kaduna, Bauchi, Niger, and the Federal Capital Territory (FCT) with the capacity to process 9,200 12.5kg of cylinders.